Khan Focuses FTC Attention on AI Competition Concerns

The FTC is watching closely to see if tech companies are unfairly or deceptively using AI technology, Chair Lina Khan said Wednesday.

Speaking at the Politico AI & Tech Summit, Khan said venture capitalists told her during a meeting in August that startups investing in AI tools have concerns about the small number of companies controlling “raw materials” and “critical inputs” associated with the technology. Industry should understand there aren’t regulatory exemptions for AI companies for unfair and deceptive practices, said Khan. Congress can further clarify this authority through statute, and FTC staff is ready to help craft legislative solutions, she said.

AI also was the focus of a Senate Rules Committee hearing Wednesday. Chair Amy Klobuchar, D-Minn., said her goal is to move her legislation in a broader package in the Senate. She introduced the Protect Elections from Deceptive AI Act (see 2309140050) with Senate Privacy Subcommittee ranking member Josh Hawley, R-Mo. It also has the support of Sens. Chris Coons, D-Del., and Susan Collins, R-Maine. Klobuchar said AI technology is being used to proliferate misleading, viral content to deceive voters. It’s creating an “untenable” situation where voters from both parties aren’t able to identify manipulated videos of political candidates, Klobuchar said. Her bill would ban the use of AI to “generate materially deceptive content falsely depicting federal candidates in political ads.”

AI is “very much” a “cross-aisle” conversation, Rep. Jay Obernolte, R-Calif., said on a separate Politico panel. Obernolte, vice chair of the Congressional AI Caucus, said the AI task force created by House Speaker Kevin McCarthy, R-Calif., has been meeting regularly for the past three months. Like the working group established by Senate Majority Leader Chuck Schumer, D-N.Y., the House task force’s goal is to develop a regulatory framework, said Obernolte. A framework doesn’t mean “a bunch of buzzwords flying in close formation,” said Obernolte: The final result should be durable, bipartisan and bicameral legislation.

Khan shared details about the agency’s motivation in filing an antitrust lawsuit against Amazon on Tuesday with 17 state attorneys general. She said she believes Amazon is forcing platform sellers to accept unfair terms. For example, she said Amazon takes as much as a 50% cut from sellers using its fulfillment services, which the agency argued in its lawsuit is a necessity for sellers to succeed on the platform. The price hike is inevitably passed onto consumers, she said: “This case is really about ensuring the American public is getting the benefit of free and fair competition.”

The New Democrat Coalition’s 24-member AI Working Group, meanwhile, met Wednesday with faculty from Carnegie Mellon University to learn more about the technology, the coalition announced. Working group Chair Derek Kilmer, D-Wash., and Vice Chair Susie Lee, D-Nev., said the goal is “forward-thinking” policy that ensures the U.S. remains the leader on AI innovation and safety.