Amazon's AI Ambitions Under FTC Scrutiny Amid Adept Deal

The U.S. Federal Trade Commission (FTC) has asked Amazon for more details on its deal to hire top executives and researchers from AI startup Adept, reflecting the FTC's growing concern about AI deals. This inquiry centers on last month's announcement that Adept CEO David Luan and others were joining Amazon (AMZN), which would also license some of the startup's technology. Amazon is striving to catch up with Google (GOOGL) and Microsoft (MSFT) in developing large language models. Adept raised over $400 million from venture capital investors but failed to launch successful commercial products. The FTC declined to comment.

The FTC is also investigating a similar move by Microsoft, which hired away much of another startup, Inflection AI's leadership, and agreed to pay a roughly $650 million licensing fee. Amazon has invested $4 billion in AI startup Anthropic since September. The FTC's extensive document request in January seeks details on how AI company partnerships with Big Tech influence strategy, pricing decisions, access to products and services, and personnel decisions.

• FTC requested details on Amazon's deal with Adept.
• Amazon aims to catch up with Google and Microsoft in AI.
• FTC investigating AI partnerships and Big Tech influence.

• Adept executives joined Amazon's AGI team.
• FTC looking into Microsoft's deal with Inflection AI.
• Amazon invested $4 billion in AI startup Anthropic.

• FTC's inquiry may lead to broader investigations.
• Impact on Amazon's AI strategy and development.
• Antitrust concerns over Big Tech's AI market dominance.

The FTC is already investigating a similar move by Microsoft, which hired away much of another startup, Inflection AI's leadership, and agreed to pay a roughly $650 million licensing fee. The FTC is looking into whether the deal was a play to skirt merger disclosure requirements. This is not Amazon's first AI startup bet, as it has invested $4 billion in AI startup Anthropic since September, taking a minority stake in the San Francisco company.

The extensive document request, made in January, seeks details on how AI company partnerships with Big Tech influence strategy, pricing decisions, access to products and services, and personnel decisions. U.S. antitrust enforcers also expressed concern about Big Tech companies wielding their existing advantages in AI to shut out smaller competitors. The FTC and Justice Department have staked out responsibility for potential probes into Microsoft, OpenAI, and chipmaker Nvidia (NVDA).