The US government is gearing up for an AI antitrust fight

The US Federal Trade Commission and the Department of Justice’s antitrust division say they’ll scrutinize the new field of artificial intelligence-powered tools for signs of anti-competitive behavior. FTC Chair Lina Khan and Justice Department antitrust head Jonathan Kanter made remarks about the issue at the agencies’ joint Enforcers Summit, raising the fear of large companies leveraging AI’s economies of scale to crush competition.

“As you have machine learning that depends on huge amounts of data and also depends on huge amounts of storage, we need to be very vigilant to make sure that this is not just another site for the big companies becoming bigger and really squelching rivals,” Khan said at the summit, according to The Wall Street Journal. She warned that major companies may “start to panic” at an upset in the tech order — “sometimes having to resort to anticompetitive tactics to protect their moats and protect their dominance.”

Kanter added that the current model of AI is “inherently dependent on scale,” raising risks of monopolization by big companies. “Markets that are inherently dependent on scale often present a greater risk of having deep moats and barriers to entry. It’s really important that we understand that.”

Generative AI — a genre of tools that can produce text and images based on user prompts — is currently dominated by a mix of giants like Google and Microsoft, highly pedigreed newer players like the formerly Elon Musk-backed OpenAI, and smaller startups like Midjourney and Stable Diffusion creator Stability AI. But running the models is expensive and requires huge amounts of data collection, and as investors start expecting it to turn a profit, it may amp up pressure across the board. Likewise, as companies try to make the models less prone to unwanted output, they could require more human refinement and scrutiny of their vast datasets.

The FTC, in particular, has tried to push its authority into emerging tech industries that aren’t yet semipermanently dominated by incumbents. It recently tried and failed to block Quest VR headset maker Meta’s purchase of Within, a VR fitness app maker that Khan said could push Meta into competing more on software. For now, however, we’re expecting cases in more traditional fields soon — including a potentially massive suit against Amazon.