AI Startup Mask Files Lawsuit Against OpenAI and Apple for Anti-Competitive Practices

Elon Musk’s AI startup, Xai, has initiated legal action against OpenAI and Apple, accusing them of anti-competitive practices. This lawsuit, submitted on Monday in a Texas court, alleges a “conspiracy to monopolize the smartphone and generative AI chatbot market.”

Earlier this month, Musk had hinted at legal action against Apple and OpenAI, criticizing ChatGPT and claiming that other AI companies faced barriers to reaching the top of the App Store. Musk’s Xai has developed a chatbot called Grok.

The lawsuit challenges a significant collaboration between Apple and OpenAI. That partnership was announced last year, allowing Apple to integrate OpenAI’s AI functionality into its operating system. Musk’s legal action aims to disrupt one of Apple’s major ventures into AI and OpenAI’s standout partnership, accusing them of “restricting the market.”

According to the complaint, “The defendants have engaged in unlawful agreements and conspiracies to exploit Apple’s monopoly in the US smartphone industry while upholding OpenAI’s dominance in generative AI chatbots.” They are also seeking “billions in damages.”

OpenAI has dismissed Musk’s claims, characterizing the lawsuit as part of his ongoing vendetta against the company. An OpenAI representative stated, “This latest filing is indicative of Musk’s persistent pattern of harassment.”

Apple has not yet responded to inquiries for comment.

This lawsuit marks a new chapter in the longstanding feud between Musk and Altman. The two tech titans co-founded OpenAI in 2015 but have increasingly drifted apart, frequently engaging in legal disputes.

Musk departed from OpenAI after expressing interest in taking control of the organization in 2018, subsequently launching several lawsuits concerning its transition to a for-profit model. Altman and OpenAI have consistently rebuffed Musk’s criticisms, portraying him as a vindictive former associate.

“It’s unfortunate to see this from those we’ve held in high regard. He urged us to push our limits, but when we indicated we might fail, he formed competitor companies and made significant strides towards OpenAI’s mission without him.”

Tensions between Altman and Musk escalated earlier this month following Musk’s accusations directed at Apple. Musk claimed that Apple was manipulating App Store rankings to disadvantage other AI competitors, prompting a public exchange of challenges between the two tech leaders.

“It’s an unexpected assertion given that Elon claims to manipulate X for personal gain while undermining individuals he opposes,” Altman wrote in response to Musk’s claims about Apple’s favoritism toward OpenAI.

Currently, OpenAI is concentrating on a $500 million valuation, poised to become the most valuable private entity at $350 billion, surpassing Musk’s SpaceX, which holds the current title.

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Watchdog accuses Google of employing anti-competitive tactics in UK ad market

Britain’s competition watchdog has accused Google of anti-competitive behavior in the market for buying and selling advertising on websites, following similar investigations in the US and EU.

The Competition and Markets Authority (CMA) said it had found that Google had “abused its dominant position” in online advertising, to the detriment of thousands of UK publishers and advertisers.

The CMA said that while the majority of publishers and advertisers use Google’s advertising technology services to bid for and sell advertising space, Google is preventing its rivals from offering a competitive alternative.

Regulators are focusing on Google’s role in three areas: owning two tools for buying ad space, running an advertising platform that allows publishers to manage their ad space online, and managing AdX, an ad exchange that brings together advertisers and publishers in a way that matches buyers and sellers in the stock market.

“The CMA is concerned that Google is actively using its dominance in this sector to favor its own services,” the watchdog said. “Google is putting competitors at a disadvantage and preventing them from competing on a level playing field to offer publishers and advertisers better, more competitive services that will help them grow their businesses.”

In its interim findings published on Friday, the CMA found that Google abused its dominant market position by using its own buying tools and inventory tools for publishers to bolster its own ad trading position and protect it from competition since 2015. The CMA also alleged that Google blocked rival ad inventory tools (called publisher ad servers) from effectively competing with its own product, DoubleClick for Publishers.

The CMA will consider Google’s response before making a final decision.

Regulators can impose fines of up to 10% of a company’s global turnover depending on the severity of the violations, and can also issue legally binding directions to end the violations.

In a statement, Google said the CMA’s arguments were “flawed”.

“Our ad tech tools help websites and apps fund their content and help businesses of all sizes effectively reach new customers,” said Dan Taylor, Google’s vice president of global advertising. “At the heart of this lawsuit is a misinterpretation of the ad tech sector. We disagree with the CMA’s position and will respond accordingly.”

The U.S. Department of Justice and the European Commission are also investigating Google’s ad tech activities: In June 2023, EU regulators said Google may have to sell parts of its ad tech business to address concerns, while the U.S. Department of Justice is set to accuse Google in court on Monday of monopolizing the ad tech market.

Last month, a federal court ruled that Google was illegally monopolizing the internet search market, a decision that could lead to a partial breakup of the company’s business.

Source: www.theguardian.com