Syed Imran Haider 
A deal was struck between the Federal Trade Commission and the US Department of Justice (DOJ). The said deal would clear the path to potential antitrust probes into some major companies.
According to sources familiar with the matter, Nvidia, OpenAI and Microsoft would be under investigation for their role in the artificial intelligence (AI) industry.
Regulatory scrutiny
The fact that the two agencies have come to an agreement shows that regulatory scrutiny is becoming a priority for industries that make up AI.
Not only do Nvidia and Microsoft dominate their respective industries, but are also two of the biggest companies in the world in terms of market cap.
Nvidia recently took over the second spot from Apple Inc., as its total market cap exceeded $3 trillion.
Antitrust regulators in the US have been vocal about their concerns related to AI. This includes the advantage to Big Tech firms due to their data access, which can be used for training AI models.
There have also been concerns about the impact on creative work because of generative AI, along with companies partnering to avoid merger review processes.
The history
This is not the first time that agencies have tried to divvy up an industry. There had also been a similar agreement back in 2019 between two agencies for dividing enforcement against Big Tech.
Ultimately, this saw the DOJ file a lawsuit against Google and Apple for alleged violations. Meanwhile, the FTC sued Amazon and Meta.
The companies have obviously denied any wrongdoing and the lawsuits are still ongoing. A nonprofit serves as the parent company of OpenAI.
However, a $13 billion investment from Microsoft in a for-profit subsidiary gives the company a stake of 49% in OpenAI.
The new deal
According to the source, the new deal was made in the last week and will be finalized in the coming days.
As per the deal, the FTC will take the lead to investigate whether Microsoft and OpenAI violated antitrust laws. Meanwhile, the Justice Department will examine the conduct of Nvidia.
Almost 80% share of the AI chip market belongs to Nvidia. The company also makes the custom AI processors that belong to cloud computing firms like Amazon.com, Microsoft and Google.
Thanks to this domination, Nvidia’s has gross margins between 70% and 80%. According to Microsoft, it has complied with all legal obligations and it reports all transactions.
OpenAI and Nvidia did not comment on the matter. The FTC had already launched a probe into OpenAI last year.
It claimed that the company had violated consumer protection laws and had put personal data and reputations at risk.
Back in January, the FTC had also ordered Microsoft, Amazon, OpenAI, Anthropic and Alphabet to provide information about their partnerships and investments in generative AI firms.
Jonathan Kanter, the antitrust chief of the Justice Department, attended an AI conference last week at Stanford University.
He stated that some trends and structures and AI were concerning, as the technology depends on huge amounts of computing power and data.
