Microsoft, Nvidia to Face US Antitrust Probes Over AI Moves

 The US is opening antitrust investigations into two of the world’s most valuable companies, Microsoft Corp. and Nvidia Corp., over their dominance of the rapidly emerging field of artificial intelligence, according to people familiar with the matter.

Microsoft has poured more than $13 billion into its partnership with OpenAI, tapping the startup’s generative-AI technology for the Bing search service, Edge internet browser and Windows. Nvidia, the world’s most valuable chipmaker, has acknowledged allocating its chips to customers it deems most likely to use them quickly, prompting concerns that it has too much power over the market for cutting-edge AI semiconductors.

The country’s two antitrust agencies also agreed to divide responsibility over AI. The Federal Trade Commission will handle the inquiry into Microsoft’s ties with OpenAI, while the Justice Department will probe Nvidia’s dominance in AI chips, said the people, who asked not to be named discussing inter-agency negotiations. The DOJ will retain oversight of Alphabet Inc.’s Google, the people said.

The agencies reached the deal in the last few days after more than six months of negotiations, the people said. The agreement gives each agency authority to open an antitrust probe into the conduct of the respective companies and their recent deals.

The FTC has also opened a probe into whether Microsoft failed to properly notify the antitrust agencies about its deal with Inflection AI, according to the people. In March, the Redmond, Washington-based software giant agreed to pay the startup $650 million to license its AI software and hired much of Inflection’s staff. The agency can levy fines if it determines Microsoft violated the law about reporting transactions.

A Microsoft spokeswoman said the company has not been contacted by the FTC regarding OpenAI.

“Our agreements with Inflection gave us the opportunity to recruit individuals at Inflection AI and build a team capable of accelerating Microsoft Copilot, while enabling Inflection to continue pursuing its independent business and ambition as an AI studio,” the company said in a statement. “We take our legal obligations to report transactions seriously and are confident that we have complied with those obligations.”

https://finance.yahoo.com/news/microsoft-nvidia-face-us-antitrust-142206018.html