Lawmakers ask FTC to determine if AI generated article summaries are anti-competitive

A Call for Regulation in the Wild West of the AI Industry

A hot potato: The AI industry currently resembles the Wild West, with very few laws in place to govern it. This lack of formal regulation has led to AI firms operating on the honor system, promising to self-regulate effectively. However, Democrats in the US Senate argue that this self-regulation experiment has failed. They are now urging trade regulators to investigate potential antitrust violations, particularly in AI-generated content summaries.

Senate Democrats have raised concerns about AI-powered features, such as Google’s AI Overviews, potentially violating antitrust laws. Led by Minnesota Senator Amy Klobuchar, a coalition has written to the Federal Trade Commission and the Department of Justice, highlighting the consolidation and job cuts in the content creation sector exacerbated by AI tools like these.

Meanwhile, tech giants like Google and Meta continue to profit immensely from advertising while utilizing articles to train their AI models.

“Dominant online platforms, such as Google and Meta, earn billions in advertising revenue annually from content created by others,” the letter states. “New generative AI features pose a threat to exacerbate these issues.”

Although the issue may initially seem more related to copyright than antitrust, Klobuchar and her colleagues argue that AI-generated summaries on search results pages redirect users’ attention to the search page instead of the original content being summarized or, in some cases, plagiarized.

The core concern is that a handful of large corporations dominating the AI space have created an oligopoly that harms consumers, small businesses, news outlets, and blogs while appropriating their content to enhance large language models. The only remedy offered by these tech giants is for website owners to opt out of indexing. The senators view this scenario as potential illegal exclusionary behavior.

However, the situation is not straightforward. For any investigation to progress, the FTC must prove that AI companies possess “overwhelming market power” and are using it in a manner that contravenes existing trade laws. Given the nascent stage of the AI industry, there are limited regulations in place to govern it. Therefore, regardless of the fairness or ethics of AI companies’ actions, they remain within legal boundaries.

Nevertheless, this could serve as a precursor to new legislation. If the FTC fails to uncover any violations, it may prompt Congress to take action. This sequence establishes a record of the Senate attempting to address the issue through regulatory channels before proposing legislative solutions.

Image credit: Nick Youngson, Gage Skidmore