In a move to better understand the competitive landscape of generative AI, the Federal Trade Commission (FTC) has initiated an inquiry into the investments made by Big Tech companies in cloud services for smaller AI companies like OpenAI and Anthropic. Alphabet, Amazon, Anthropic, Microsoft, and OpenAI have received letters from the FTC, requesting an explanation of the impact these investments have on the market.

The FTC aims to scrutinize corporate partnerships and investments between AI providers and companies like Google, Amazon, Microsoft, and OpenAI. Specifically, the commission is interested in delving into the investment agreements, as well as the influence these partnerships have on product releases and oversight rights.

Among the investments under scrutiny, Google and Amazon have invested in Anthropic, with Google currently holding a 10 percent stake in the company following a $300 million investment, and Amazon putting in a substantial $4 billion in September. Microsoft, on the other hand, has a close financial relationship with OpenAI and is the largest investor in the company, rumored to have invested $10 billion.

The FTC is seeking information on how these investments impact market share, competition, and potential sales growth within the sector. It also wants to know if there is any competition for resources to develop AI products, as well as any information each company may have shared with other government entities.

Each of the companies has been given 45 days to respond to the agency's request. The Verge reached out for comments from Google, Anthropic, and Microsoft, but only received responses from Microsoft. OpenAI and Amazon both declined to comment on the matter.

The partnership between Microsoft and OpenAI has raised significant interest from the government, leading to arguments with the Department of Justice over who will initiate the inquiry. Microsoft's close relationship with OpenAI allowed it to launch GPT-4-powered applications in its Copilot service.

This investigation marks the first time that the FTC has looked into OpenAI's operations. The agency had previously requested documents from the ChatGPT maker in July, seeking information on possible consumer harm stemming from the publishing of false information.

FTC Chair Lina Khan emphasized the importance of ensuring fair competition during the race to develop and monetize AI technologies, stating, "History shows that new technologies can create new markets and healthy competition. As companies race to develop and monetize AI, we must guard against tactics that foreclose this opportunity."

The outcome of the inquiry could have significant implications for the future of AI development and partnerships within the industry. As the investigation unfolds, it remains to be seen how the investments made by Big Tech companies will be assessed and what impact they may have on the competitive landscape of AI.