Biden's Top Antitrust Enforcer To 'Urgently' Scrutinize AI Sector For Monopoly Risks
The top US anti-trust enforcer warned in an interview with the Financial Times about the "monopoly choke points and the competitive landscape" in the artificial intelligence space. He pointed out critical areas of concern, ranging from computing power and the data needed to train large language models, to cloud service providers, engineering talent, and access to critical hardware such as graphics processing unit chips.
According to Jonathan Kanter, the head of the Justice Department's anti-trust division, regulators are concerned with Big Tech's potential oligopolistic power over AI and must act "with urgency" to ensure that these companies do not control the market.
Kanter said regulators are concerned that AI is already "at the high-water mark of competition, not the floor."
"Sometimes the most meaningful intervention is when the intervention is in real-time," the official continued, adding, "The beauty of that is you can be less invasive."
Kanter pointed out that regulators are reviewing the competitive landscape in graphics processing units, as these critical chips have become a "scarce resource." He said the government is looking at how chipmakers allocate their GPUs amid skyrocketing demand.
"One of the things to think through is conflict of interest, a thumb on the scale, because they fear enabling a competitor or are helping to prop up a customer," the official said.
He noted, "If decisions are being made that show companies are not caring about maximizing profitability or generating shareholder value, but more looking at the competitive consequences," then that would be a major issue.
In the LLM space, OpenAI's ChatGPT chatbot has become the most dominant and recognizable. Microsoft's $13 billion investment in OpenAI has sparked inquiries from the Federal Trade Commission and multiple competition watchdogs in Europe. These regulators are also probing Google and Amazon's multi-billion deals with rival Anthropic.
As Kanter probably understands, it's not just AI. Big Tech's stranglehold over data, search, and cloud services is similar to past monopolies, such as Standard Oil and AT&T. The government is realizing that anti-trust action is necessary moving forward.
However, regulation kills innovation, and perhaps government intervention will only hurt tech companies in the global competitive market. Perhaps the Biden administration's overregulation is why more Silicon Valley investors than ever are jumping on Trump's deregulation and capitalism bandwagon ahead of the presidential elections.