Nvidia, Microsoft, and OpenAI may face antitrust investigations from U.S. regulators.

• Microsoft, OpenAI, and Nvidia are facing antitrust probes from the Federal Trade Commission and the Justice Department, which will scrutinize their impact on the AI industry, a source close to CNBC confirmed.
• According to the source, the FTC will investigate Microsoft and OpenAI, while the DOJ will investigate Nvidia, and the focus of the investigations will be on the companies' conduct, rather than mergers and acquisitions.

Antitrust investigations into OpenAI and are being launched by the Federal Trade Commission and the Justice Department, according to a source who confirmed this to CNBC. The focus is on the influence of these powerful companies on the artificial intelligence industry.

According to the source, the FTC will investigate Microsoft and OpenAI, while the DOJ will investigate Nvidia, and the focus of the investigations will be on the companies' conduct, rather than mergers and acquisitions.

The New York Times first reported on the investigation.

The generative AI market is growing rapidly, with companies like OpenAI and Anthropic leading the way. In response, tech giants such as Google, Microsoft, Amazon, and Meta are engaging in an AI arms race to integrate the technology and maintain their competitive edge in a market predicted to reach $1 trillion in revenue within the next decade.

Microsoft initially invested $1 billion in OpenAI in 2019, and its investment has since grown to approximately $13 billion. Microsoft heavily utilizes OpenAI's model for its Copilot chatbot and provides open source models on its Azure cloud.

The high cost of building and training AI models necessitates significant investments, with Nvidia's specialized chips being a major contributor. Nvidia has announced that it is spending billions on graphics processing units, which have helped the chipmaker increase its year-over-year revenue by more than 250%.

An antitrust investigation into the AI industry is being announced, just days after a group of current and former OpenAI employees published an open letter expressing concerns about the industry's rapid progress, the lack of oversight, and the absence of whistleblower protections for those who wish to speak up.

"The employees stated that AI companies have financial motivations to evade effective supervision, and customized corporate governance structures are not enough to alter this. They pointed out that the companies currently have minimal obligations to disclose some information to governments, and none to civil society. The employees believe that these companies cannot be trusted to share this information voluntarily."

The FTC's January decision to investigate AI industry leaders, including Microsoft, Anthropic, and OpenAI, has been followed by news reports.

In January, Lina Khan, the FTC Chair, announced a market inquiry at the agency's tech summit on AI, focusing on the partnerships and investments being formed between AI developers and major cloud service providers.

The FTC can investigate AI companies separately from its law enforcement arm by invoking its authority to conduct a 6(b) study, which allows it to make civil investigative demands, such as ordering companies to file specific reports and answer questions in writing about their businesses.

"The FTC is closely examining the use of AI by companies to thwart competition or deceive the public, as the agency's work is being informed by the rapid development and deployment of AI."

Neither Microsoft, OpenAI, nor Nvidia responded to requests for comment.

— CNBC's Eamon Javers contributed to this report.