US senators criticize Big Tech for siphoning talent, products away from small AI startups

US senators call for investigation into tech giants’ tactics to poach AI talent

As the race for AI supremacy heats up, big tech companies are using new tactics to poach talent and technology from innovative AI startups without actually acquiring the companies themselves. Now, three U.S. senators are calling for an investigation into the practices.

One recent deal that has stirred controversy is that between San Francisco-based Adept and Amazon. Under the deal, Adept’s CEO and key employees will join Amazon, while the e-commerce giant will license Adept’s AI systems and datasets. This type of deal, called a “reverse acqui-hire,” has raised concerns among lawmakers who worry it could be a way for tech giants to skirt U.S. laws that prevent monopolistic behavior.

Senator Ron Wyden, a Democrat from Oregon, has expressed concerns about the consolidation of talent and technology in the AI ​​industry, saying: “A few companies control a significant portion of the market and they’re just focused on buying up everyone else’s talent instead of focusing on innovation.”

While acqui-hiers, or the acquisition of talent by one company by another, are common in the tech industry, the tactics used in the AI ​​sector raise new concerns. Michael A. Cusumano, a business professor at MIT, noted that these partial acquisitions and talent acquisitions represent a new twist on traditional acquisition strategies.

In a similar move, Microsoft hired the co-founder and CEO of AI startup Inflection, along with several key employees, to lead its consumer AI business. That deal has already drawn scrutiny from regulators, particularly in Europe.

In response, Senators Wyden, Elizabeth Warren of Massachusetts, and Peter Welch of Vermont called on law enforcement agencies at the Justice Department and the Federal Trade Commission to take action against unauthorized consolidation in the technology industry.

As the Biden administration and lawmakers from both parties show growing interest in regulating the tech industry, tech giants like Microsoft, Amazon and Google are wary of AI acquisitions. But critics say talent acquisitions and partial acquisitions could still raise antitrust concerns.

For smaller AI startups, the challenges of competing in the AI ​​industry are significant, as building AI systems requires significant resources and expertise. Some companies, like Adept, may see these talent acquisitions as a way to secure their future in a competitive market.

While these tactics may help tech giants like Amazon gain an advantage in the AI ​​industry, they have raised concerns about fair competition and innovation. As regulators and lawmakers continue to investigate these practices, the future of AI talent acquisitions remains uncertain.