"Investing.com -- Partnerships between major cloud service providers like Microsoft Corporation (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL), and Amazon.com Inc (NASDAQ:AMZN) and AI developers such as OpenAI and Anthropic could potentially impact market competition and access to key resources, the Federal Trade Commission's Office of Technology staff said in a report released Friday.
"The partnerships provide CSP partners certain consultation, control, and exclusivity rights with respect to their AI developer partners to varying degrees," the report said.
The FTC study, which examined partnerships between Microsoft-OpenAI, Amazon-Anthropic, and Google-Anthropic, found that these agreements could potentially impact AI model development and determine many aspects of individuals' and firms' experiences with AI technology.
Under these partnerships, cloud service providers, or CSPs, could gain significant equity and certain revenue-sharing rights in their AI developer partners, with the possibility of full acquisition in the future, according to the report. This raises concerns that CSPs could limit access to inputs such as computing resources for AI developers and engineering talent, erecting potential barriers to entry for new AI developers.
The partnerships also include substantial cloud commitments, requiring AI developers to spend a large portion of their CSP partner's investment on cloud services from their partners. This circular spending is "one avenue through which CSP partners may potentially aim to reduce the magnitude of potential loss invested directly into their partners and cloud infrastructure to serve their partners," the report said.
The partnerships may also provide CSP partners access to "sensitive technical and business information that may be unavailable to others," providing CSPs an unfair advantage in the AI market, according to the report.