US Justice Department And FTC Enter Power Struggle As Both Wish To Investigate Microsoft’s Relationship With OpenAI

The American Justice Department and the FTC have both been raising serious concerns related to software giant Microsoft’s collaboration with OpenAI.

Seeing the company invest millions and grow quite close to the ChatGPT maker was already on many people’s minds in terms of how that could serve to eliminate competition in today’s market.

Now, we’re getting to hear so much more on this front including how a power struggle has been attained by both the DOJ and the FTC in terms of who gets to scrutinize the companies.

The report comes to us thanks to media outlet Politico who added recently how both of these agencies were excited to start the rounds of investigation and why Microsoft is so keen on being involved with the AI firm. They hoped to better gauge what sort of competition this could have in today’s AI industry which continues to flourish as we speak.

A lot of antitrust behavior was noted too and now, neither plan on giving up jurisdiction on this front was said to create major hurdles and roadblocks that lead to a formal investigation arising right now.

The crux of the matter appears to be the huge number of investments made by Microsoft in the recent past. It all began when they rolled out the first set of funding in 2019 and this continued for the next couple of years. The software giant also combined services from OpenAI into its own Bing search engine as well as Microsoft Office to get better and more useful products.

One interview had the CEO of OpenAI speak about how the collaboration between both tech giants is more than solid. He hoped that the company would continue to invest in the firm. However, this raised serious concerns in terms of serving as unfair advantages for both enterprises, especially when it comes down to LLMs.

In the past, we saw both regulatory bodies avoiding overlapping investigations so that peace would be maintained. We also saw how they attained handshake agreements to split both organizations up so that they could continue with antitrust investigations of the big names in the industry.

This meant Meta’s Facebook and Amazon would be allocated to FTC while Google and Apple would be sent in the DOJ’s direction.

Recently, one investigation by Microsoft’s Activision-Blizzard overtook but they entered into an agreement about not leveraging that for future legal negotiations.

But a rep for Microsoft denied that statement and mentioned it during a December statement from the software giant’s President Brad Smith who detailed more on the front.

He says that since the year 2019, OpenAI has held great personal and business relationships with the software giant, and that has paved the way for more innovation in the world of AI. This includes more room for competition to take center stage. This helped to preserve independence for both firms along the way too, he added.

But the only thing which altered so far is that the software giant would be taking on the role of non-voting observer during the company’s Board meetings. In case you didn’t know, that’s a very differnet approach when you compare it to the acquisition like that of Android maker Google who purchased DeepMind in the United Kingdom. They hope to work side by side with the CMA to give them all the data that they need on this front.

For now, we know that the scrutiny of both tech giants and their much-talked-about partnership will remain under scrutiny. Moreover, the CMA added in December of 2023 how it hoped to give more chances to all parties keen on submitting comments to the regulator. This would have to do with whether the Microsoft-OpenAI collaboration would give rise to a possible merger or not.

From the looks of it, this is the most serious concern of most investigators today as that could really wipe out major competing firms working on a smaller scale but trying to attract the masses with the same goal as OpenAI.

So as you can see, it’s quite a tricky situation, and wouldn’t be wrong to dub this as a sticky mess.

Photo: Digital Information World - AIgen/HumanEdited

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