WASHINGTON, October 2, 2023 – The chair of the Federal Trade Commission warned the artificial intelligence industry Wednesday that the agency is prepared to clamp down on any monopolistic practices, as she proposed more simplistic rules to avoid confrontation.

“We’re really firing on all cylinders to make sure that we’re meeting the moment and the enormous and urgent need for robust and vigorous enforcement,” Lina Khan said at the AI and Tech Summit hosted by Politico on Wednesday.

Khan emphasized that the FTC’s statute on consumer protection “prohibits unfair deceptive practices” and that provision extends to AI development.

The comments come as artificial intelligence products advance at a brisk pace. The advent of new chat bots – such as those from OpenAI and Google that are driven by the latest advances in large language models – has meant individuals can use AI to create content from basic text prompts.

Khan stated that working with Congress to administer “more simplicity in rules” to all businesses and market participants could promote a more equal playing field for competitors.

“It’s no secret that there are defendants that are pushing certain arguments about the FTC’s authority,” Khan said. “Historically we’ve seen that the rules that are most successful oftentimes are ones that are clear and that are simple and so a regime where you have bright line rules about what practices are permitted, what practices are prohibited, I think could provide a lot more clarity and also be much more administrable.”

Khan’s comments came the day before the agency and 17 states filed an antitrust lawsuit against Amazon, which is accusing the e-commerce giant of utilizing anticompetitive practices and unfair strategies to sustain its supremacy in the space.

“Obviously we don’t take on these cases lightly,” Khan said. “They are very resource intensive for us and so we think it’s a worthwhile use of those resources given just the significance of this market, the significance of online commerce, and the degree to which the public is being harmed and being deprived of the benefits of competition.”

Since being sworn in 2021, Khan’s FTC has filed antitrust lawsuits against tech giants Meta, Microsoft, and X, formerly known as Twitter.

WASHINGTON, April 19, 2023 — House Republicans expressed skepticism about the Federal Trade Commission’s requested budget increase during a Tuesday hearing, accusing the agency of overstepping its jurisdiction in pursuit of a progressive enforcement agenda.

The hearing of the Innovation, Data and Commerce Subcommittee showcased sharp partisan tension over Chair Lina Khan’s aggressive approach to antitrust — heightened by the fact that both Republican seats on the five-member agency remain vacant.

Khan, alongside Democratic Commissioners Rebecca Slaughter and Alvaro Bedoya, argued that the $160 million budget increase was necessary for maintaining existing enforcement efforts as well as “activating additional authorities that Congress has given us.”

But Republican lawmakers seemed unwilling to grant the requested funds, which would bring the agency’s total annual budget to $590 million.

“You seem to be squandering away the resources that we currently give you in favor of pursuing unprecedented progressive legal theories,” said Subcommittee Chair Gus Bilirakis, R-Fla.

“What is clearly needed — before Congress considers any new authorities or funding — are reforms, more guardrails and increased transparency to ensure you are accountable to the American people,” said Rep. Cathy McMorris Rodgers, R-Wash., chair of the Energy and Commerce Committee.

Rep. Frank Pallone, D-N.J., ranking member of the full committee, defended the funding request by saying the FTC has “one of the broadest purviews of any federal agency: fighting deceptive and unfair business practices and anti-competitive conduct across the entire economy.”

“Managing this portfolio with less than fourteen hundred employees is no small feat,” Pallone said, noting that the FTC currently has fewer employees than it did 45 years ago.

FTC highlights potential AI threats, other tech developments

FTC staff and Democratic lawmakers have been flagging concerns about understaffing at the agency for years, arguing that rapid technological and market changes have increased the scope and complexity of the agency’s role.

“The same lawyers who ensure that social media companies have robust privacy and data security programs are making sure labels on bed linens are correct,” testified former Chief Technologist Ashkan Soltani at a Senate hearing in 2021.

In their written testimony, commissioners detailed several emerging priorities related to technological developments — such as combatting online harms to children and protecting sensitive consumer data shared with health websites — and emphasized the corresponding need for increased resources.

The agency is also preparing to pursue violations related to artificial intelligence technologies, Khan said, as the “turbocharging of fraud and scams that could be enabled by these tools are a serious concern.”

But several tech-focused trade groups, including the Computer & Communications Industry Association, have signaled opposition to FTC expansion.

“The FTC can best carry out its mission if it heeds the committee’s call to return its focus to consumer needs and consumer fraud — rather than pursuing cases rooted in novel theories against American companies,” CCIA President Matt Schruers said after the hearing.

The Consumer Technology Association urged lawmakers to reject the requested budget increase in a letter sent Friday.

“In 2022, agency data shows consumers reported losing almost $8.8 billion to scams… Despite this mounting caseload of fraud, identity theft and related cases, the FTC appears more interested in attacking U.S. tech companies, to the detriment of consumers who have benefitted from an unparalleled explosion of innovative, online-based products and services,” CTA President Gary Shapiro wrote.

April 18, 2023 — Google CEO Sundar Pichai on Sunday called for increased regulation of artificial intelligence, warning that the rapidly developing technology poses broad societal risks.

“The pace at which we can think and adapt as societal institutions compared to the pace at which the technology’s evolving — there seems to be a mismatch,” Pichai said in an interview with CBS News.

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Widespread AI applications could lead to a dramatic uptick in online disinformation, as it becomes increasingly easy to create and spread fake news, images and videos, Pichai warned.

Google recently released a series of recommendations for regulating AI, advocating for “a sectoral approach that builds on existing regulation” and cautioning against “over-reliance on human oversight as a solution to AI issues.”

But the directive also noted that “while self-regulation is vital, it is not enough.”

Pichai emphasized this point, calling for broad multisector collaboration to best determine the shape of AI regulation.

“The development of this needs to include not just engineers, but social scientists, ethicists, philosophers and so on,” he said. “And I think these are all things society needs to figure out as we move along — it’s not for a company to decide.”

Republicans call to ban members of Congress from personal TikTok use

A group of Republican lawmakers on Monday urged the House and Senate rules committees to ban members of Congress from using TikTok, citing national security risks and the need to “lead by example.”

Congress banned use of the app on government devices in late 2022, but several elected officials have maintained accounts on their personal devices.

In Monday’s letter, Republican lawmakers argued that the recent hearing featuring TikTok CEO Shou Zi Chew made it “blatantly clear to the public that the China-based app is mining data and potentially spying on American citizens.”

“It is troublesome that some members continue to disregard these clear warnings and are even encouraging their constituents to use TikTok to interface with their elected representatives – especially since some of these users are minors,” the letter continued.

TikTok is facing hostility from the other side of the aisle as well. On Thursday, Rep. Frank Pallone, D-N.J., sent Chew a list of questions about the app’s privacy and safety practices that House Democrats claimed were left unanswered at the March hearing.

Meanwhile, Montana lawmakers voted Friday to ban TikTok on all personal devices, becoming the first state to pass such legislation. The bill now awaits the signature of Gov. Greg Gianforte — who was one of several state leaders last year to mimic Congress in banning TikTok from government devices.

Nine additional states join DOJ’s antitrust lawsuit against Google

The Justice Department announced on Monday that nine additional states joined its antitrust lawsuit over Google’s alleged abuse of the digital advertising market.

The Attorneys General of Arizona, Illinois, Michigan, Minnesota, Nebraska, New Hampshire, North Carolina, Washington and West Virginia joined the existing coalition of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee and Virginia.

“We look forward to litigating this important case alongside our state law enforcement partners to end Google’s long-running monopoly in digital advertising technology markets,” said Doha Mekki, principal deputy assistant attorney general of the Justice Department’s Antitrust Division.

The lawsuit alleges that Google monopolizes digital advertising technologies used for both buying and selling ads, said Jonathan Kanter, assistant attorney general of the Justice Department’s Antitrust Division, when the suit was filed in January.

“Our complaint sets forth detailed allegations explaining how Google engaged in 15 years of sustained conduct that had — and continues to have — the effect of driving out rivals, diminishing competition, inflating advertising costs, reducing revenues for news publishers and content creators, snuffing out innovation, and harming the exchange of information and ideas in the public sphere,” Kanter said.