BUSINESS-ECONOMY
The US Federal Trade Commission (FTC) has pulled Amazon for more information over its recent deal to hire top executives and researchers from AI startup Adept. The US Federal Trade Commission (FTC) has pulled Amazon for more information over its recent deal to hire top executives and researchers from AI startup Adept. That signals an increasing unease by the FTC regarding how AI-related deals are structured and follows a wider review of collaborations between major tech firms and top AI startups. The probe, which hasn't been previously reported, centres on the following: Amazon announced last month that Adept's CEO, David Luan, and other top officials were joining Amazon, as well as that Amazon would license some of Adept's technology. Such informal inquiries do not always lead to official investigations or enforcement actions. The push here for Amazon is to try to match other competitors like Google or Microsoft in racing to develop advanced large language models for instant responses to complex prompts. This project will now be led under the new Artificial General Intelligence (AGI) team at Amazon by Luan, heading the "AGI Autonomy" team of many people formerly at Adept, reporting directly to Rohit Prasad, head of the AGI team. In 2022, Adept attracted attention early on with its $400 million capital raise from venture capital investors for training large models for general-use tasks aimed at enterprise customers. Valued at a plus of $1 billion and having open-sourced some of the models, Adept could not launch successful commercial products. What remains to be seen is whether Amazon has compensated the investors or, at a minimum, licensing fees. The FTC, Amazon, and Adept have all declined to comment. But as part of a broader pattern, the FTC is separately investigating a similar move by Microsoft, which recently poached key leadership and employees from another startup, Inflection AI, and agreed to a $650 million licensing fee. People familiar with the matter say the FTC has begun investigating whether such deals are being used to circumvent merger disclosure requirements. This isn't the first time that Amazon has tiptoed into the AI startup space. Since September, Amazon has sunk $4 billion into AI startup Anthropic in exchange for a minority stake in the San Francisco company. Back in January, the FTC opened an investigation into investments and partnerships in the AI space by requesting information on the relationships between large tech firms like Microsoft, Google, and Amazon and AI companies, including how such deals affect strategic decisions, pricing, product and service access, and personnel. In the US, antitrust regulators have pointed out such concerns that large technology companies might use this AI advantage against smaller rivals. The FTC and the Justice Department have divvied the oversight of potential investigations into companies like Microsoft, OpenAI, and Nvidia. A journalist, writing for the WION Business desk. Bringing you insightful business news with a touch of creativity and simplicity. Find me on Instagram as Zihvee, tr None
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