Both DOJ and FTC Want to Open Probe of Microsoft/OpenAI Ties

Both DOJ and FTC Want to Open Probe of Microsoft/OpenAI Ties

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By  |  January 21, 2024

A pair of federal agencies reportedly wants to investigate OpenAI’s relationship with Microsoft.

The question is, which one: The Department of Justice (DOJ) or the Federal Trade Commission (FTC)? 

A report Friday (Jan. 19) by Politico — citing sources with knowledge of the matter — said the two agencies have been in discussion for months about a possible antitrust investigation, though neither the FTC or DOJ wants to give up jurisdiction.

PYMNTS has contacted both agencies for comment but has not yet received a reply.

The standoff is happening as the relationship between one of the world’s largest tech companies and the high-profile artificial intelligence (AI) startup faces increased scrutiny on both sides of the Atlantic.

As the Politico report noted, companies must report most deals for review by antitrust regulators, but OpenAI and Microsoft — which has invested several billion dollars in the AI firm — did not. Microsoft says it has no control over OpenAI. 

However, per Politico, that claim has been questioned given Microsoft’s role in OpenAI CEO Sam Altman’s reinstatement following his brief firing in late 2023.

The sources said regulators’ concerns include whether the partnership gives the companies an unfair edge in the AI market, especially in large language model (LLM) technology.

News of the U.S. regulators’ interest in the ties between the two companies comes less than two weeks after the European Commission (EC) announced it was reviewing whether Microsoft’s involvement with OpenAI warrants further investigation.

The ties between the companies are also the subject of a possible investigation by the Competition and Markets Authority (CMA) in Great Britain. 

The regulator said in December that it hopes to determine if “recent developments” have resulted in a merger situation and if a merger could affect competition in the U.K.

Elsewhere on the AI front, recent research finds that consumers display varying levels of interest and comfort with the technology in different areas of their lives. 

Among people surveyed for the “Consumer Interest in Artificial Intelligence” edition of the “Consumer Inflation Sentiment” series, 66% showed at least some interest in AI-enabled entertainment, while 65% showed interest in AI-enabled communication and shopping. 

“However, concerns arise when it comes to healthcare, banking and work,” PYMNTS wrote last week. “Consumers are less interested in AI involvement in these aspects of their lives, possibly due to privacy, trust or job security concerns. This holds true for 40% of high-income consumers, who express concern about becoming too dependent on technology, while 29% worry about AI breaching their privacy.”

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