Just after a victory in acquiring game studio Activision Blizzard, Microsoft (MSFT) could have jumped to the front of the line for regulators seeking to stamp out potential antitrust cases. Sam Altman has been reinstated as OpenAI CEO after a brief courting by Microsoft — which owns a 49% stake in the artificial intelligence firm — and now the two companies are chummier than ever.
Duke University Professor and Venture Capitalist Sultan Meghji and Axios Tech and Policy Reporter Ashley Gold comment on how the OpenAI melodrama could change lawmakers' antitrust frameworks.
"We're going to be in a situation, I'm positive, where the output of the last five days of chaos at OpenAI will fundamentally shift the regulatory lens back to the Big Tech companies that are writing these checks," Meghji, former CIO of the Federal Deposit Insurance Corp (FDIC), tells Yahoo Finance. "Previous to this, Microsoft did not have a board seat, they were not even board observers at OpenAI. It's very clear that they will."
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AKIKO FUJITA: You know, when you think about these big tech names. you mentioned Microsoft, obviously been in the headlines, but Google, I mean, they have been under scrutiny from regulators for other issues, antitrust specifically. Microsoft, yes, they were under scrutiny for the Activision acquisition, but they've largely escaped some of that partly because they've been in close conversation with these regulators.
I wonder if you think what has transpired over the last five days, that puts them right back in the center the cross-hairs of regulators because in many ways, it points to the sheer scale, the power, the money that Microsoft has in betting on this very technology.
SULTAN MEGHJI: Absolutely. I mean, what Microsoft has put just $10 billion into OpenAI and has the ability from-- to fundamentally change what the board decided in five days with a couple of phone calls, and I think it does reframe how a lot of people are going to think about this. And whether it's Microsoft in particular or the big tech companies writ large, we're going to be in a situation-- I'm positive-- where the output of the last five days of chaos at OpenAI will fundamentally shift the regulatory lens back to the big tech companies that are writing these checks.
And now coming out of this process of five days, previous to this, Microsoft did not have a board seat, they were not even board observers at OpenAI. It's very clear that they will and so now there's a new regulatory concern, and I think an antitrust discussion is going to end up happening no matter what.
RACHELLE AKUFFO: So Ashley, if we're going to end up having this antitrust conversation, then what does that mean for some of these innovators? As you've mentioned and Sultan mentioned, it's a lot of these smaller innovators flying under the radar who perhaps aren't catching the eye of regulators. So how do-- how do you think regulators will proceed from here? What are some of the most promising legislations that you're seeing?
ASHLEY GOLD: So in the past couple of years, we've had Congress making a valiant attempt to update the antitrust laws for the digital age with the American Innovation and Competition Online Act, a couple of app store bills. Those bills made it pretty far in Congress, but they did not make it over the finish line. Where we've seen most of the action has been in the courts and in the federal agencies.
You've got ongoing tech antitrust cases at the Justice Department and at the Federal Trade Commission. The Federal Trade Commission has promised to look at OpenAI as well. So I think, like the other panelists were saying about Congress moving very slowly, that where we're going to see the most action is in these federal agencies and in courts. We have to see who ends up filing a lawsuit, and that is where we're going to see most of the action when it comes to antitrust.
In the coming years, I think that we're shifting toward a world where the antitrust laws will be updated for the digital age, but it is very slow going.