The U.S. Justice Department and the Federal Trade Commission have reached a deal that clears the way for potential antitrust investigations into the dominant roles that Microsoft (MSFT.O), OpenAI and Nvidia (NVDA.O) , play in the artificial intelligence industry, according to a source familiar with the matter.
The agreement between the two agencies shows regulatory scrutiny is gathering steam amid concerns over concentration in the industries that make up AI. Microsoft and Nvidia not only dominate their industries but are also the world's two biggest companies by market capitalization.
The move to divvy up the industry mirrors a similar agreement between the two agencies in 2019 to divide enforcement against Big Tech, which ultimately saw the FTC bring cases against Meta (META.O) and Amazon (AMZN.O), and the DOJ sue Apple (AAPL.O) and Google (GOOGL.O) for alleged violations. Those cases are ongoing and the companies have denied wrongdoing.
While OpenAI's parent is a nonprofit, Microsoft has invested $13 billion in a for-profit subsidiary, for what would be a 49% stake.
The Justice Department will take the lead in investigating whether Nvidia violated antitrust laws, while the FTC will examine the conduct of OpenAI and Microsoft.
The regulators struck the deal over the past week, and it is expected to be completed in the coming days, the person said.
Nvidia has roughly 80% of the AI chip market, including the custom AI processors made by the cloud computing companies like Google, Microsoft and Amazon.com. That domination helps the company report gross margins between 70% and 80%.
(Score: 5, Insightful) by EEMac on Friday June 07 2024, @03:39PM (1 child)
I wasn't aware the government needed more money, but apparently it's time for another shakedown.
(Score: -1, Troll) by Anonymous Coward on Friday June 07 2024, @04:01PM
When do we get the "Ignorant" moderation option?
I take it from your comment that you are all in favor of giving the FTC actual teeth then?
(Score: 4, Insightful) by Gaaark on Friday June 07 2024, @03:48PM (2 children)
"It is a tale told by an idiot, full of sound and fury, signifying nothing"
They will make a lot of noise, rattle a bunch of pens in a cup and do, as always before... nothing.
They should really just hand this over to a court in Europe if they really want to have something done.
--- Please remind me if I haven't been civil to you: I'm channeling MDC. I have always been here. ---Gaaark 2.0 --
(Score: 1) by Runaway1956 on Friday June 07 2024, @04:07PM (1 child)
I fear that you are right, but I hope that you're wrong. We saw how the case against Microsoft went when Bush Junior won his election. "Sweep it all under the rug, just get rid of it, nothing to see here, move along."
“I have become friends with many school shooters” - Tampon Tim Walz
(Score: 3, Interesting) by aafcac on Friday June 07 2024, @07:54PM
Keep in mind that it did alter MS' behavior a lot. The failure of the government to enforce antitrust laws against the other companies that took advantage of the gap created by MS being less aggressive and technology creating space for new ideas was a much bigger problem. Things like letting Apple get away with abusing the ITMS to prevent other DRMed stores from loading stuff to iPods and preventing MP3 players that weren't made by Apple from downloading any of the music directly to those players. IIRC, HP was really the only other company that had a compatible iPod with their log on it.
Or, Google with their acquisition of Double Click.
Much of that may have turned out very differently had the feds actually done their jobs and continued to enforce thing even at late '90s levels.