US Antitrust Enforcer Intensifies Scrutiny on AI Sector Amid Monopoly Concerns
The top US antitrust enforcer has pledged to scrutinize the AI sector with heightened urgency, responding to worries that the technology is becoming concentrated in the hands of a few deep-pocketed players.
Jonathan Kanter, head of the Department of Justice’s Antitrust Division, told the Financial Times that his team is examining “monopoly choke points and the competitive landscape” in AI. This includes everything from computing power and data used to train large language models to cloud services and access to hardware such as graphics processing unit chips.
Regulators are alarmed that the burgeoning AI sector is “at the high-water mark of the competition, not the floor,” and must act swiftly to prevent already-dominant tech companies from monopolizing the market, Kanter stated. This sentiment underscores the importance of maintaining a competitive environment as AI advances rapidly.
Kanter, now in his third year at the Department of Justice, has spearheaded a tougher antitrust approach in collaboration with the Federal Trade Commission. This approach includes lawsuits against tech giants like Google and Apple, accusing them of maintaining unfair monopolies in services such as app stores, search engines, and digital advertising.
He emphasized that regulators are currently focusing on the generative AI sector and the competitive dynamics in the chip industry. “The GPUs needed to train large language models have become a ‘scarce resource,’” Kanter noted.
Nvidia, which dominates the advanced GPU market, recently saw its market capitalization surpass Apple’s, making it the world’s second-most valuable listed company. Kanter highlighted government initiatives to boost domestic production, including the $39 billion in incentives provided by the Chips Act.
With that said, he added that antitrust regulators are scrutinizing how chipmakers allocate their most advanced products amid skyrocketing demand. “One of the things to think through is a conflict of interest, a thumb on the scale because they fear enabling a competitor or are helping to prop up a customer,”
Kanter continued. “If decisions are being made that show companies are not caring about maximizing profitability or generating shareholder value, but more looking at the competitive consequences,” then that would be an issue.
Since the release of OpenAI’s ChatGPT in 2022, and its unexpected adoption by so many outside of data science and AI, a new AI-focused arms race has ensued as companies seek multibillion-dollar partnerships with promising AI firms and those developing models and applications based on the technology.
Notable among these deals is Microsoft’s $13 billion investment in OpenAI, which granted rights to the startup’s intellectual property and a share of its profits without outright acquisition. The FTC, along with UK and EU competition watchdogs, has announced investigations into these relationships, including Google and Amazon’s multibillion-dollar deals with rival AI firm Anthropic.
Originally posted on OpenDataScience.com
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