Kristina Roberts
Meta, the company behind Facebook, recently made a huge $14.8 billion deal with Scale AI, a company that helps label data for artificial intelligence. This deal gives Meta a 49% stake in Scale AI, but since it’s a nonvoting stake, it doesn’t give Meta full control over the company. Because of this, the deal doesn’t automatically require a review by US regulators. However, experts say regulators might still look into it if they believe it could hurt competition or if Meta structured the deal just to avoid scrutiny.
Scale AI is an important company in the AI world because it provides labeled data, which helps AI models learn and improve. Many big tech companies, including Microsoft and OpenAI, use Scale AI’s services. Interestingly, some of these companies, like Google, are now reconsidering their partnership with Scale AI after Meta’s investment. A Scale AI spokesperson said their business remains strong and that they protect customer data carefully, but they didn’t comment on Google’s decision to step back.
As part of the deal, Scale AI’s CEO, Alexandr Wang, will join Meta but will still stay on Scale AI’s board. To avoid conflicts, his access to certain information will be restricted. This move is seen as a way to keep things fair and prevent Meta from gaining too much influence over Scale AI’s operations.
Some experts believe that big tech companies like Meta are making these kinds of deals now because they think the current US government, under President Donald Trump, is less likely to strictly regulate AI partnerships compared to the previous administration. William Kovacic, a competition law expert, said that while Trump’s regulators are suspicious of big tech companies, they haven’t shown much interest in controlling how AI develops. This might make it easier for companies like Meta to form partnerships without facing legal challenges.
In the past, the Federal Trade Commission (FTC) has looked into similar deals where big companies hire top talent from smaller AI startups. For example, the FTC investigated Amazon’s deal with Adept and Microsoft’s $650 million agreement with Inflection AI. However, no major action was taken in these cases. Amazon’s deal went through without issues, and Microsoft’s deal is still under review, but no enforcement has happened yet.
David Olson, a law professor, thinks Meta was smart to take a nonvoting stake in Scale AI because it gives them some legal protection. Still, he says the FTC might still want to review the agreement to make sure it doesn’t harm competition.
Not everyone is happy with this deal. US Senator Elizabeth Warren, who is known for being tough on big tech companies, said that Meta’s investment should be closely examined. She warned that if the deal violates antitrust laws by reducing competition or helping Meta dominate the market unfairly, regulators should step in and block it.
Meta is already facing a monopoly lawsuit from the FTC, so this new deal could bring even more attention from regulators. Right now, it’s unclear whether the FTC will take any action, but the deal is definitely being watched closely.
AI is becoming more important in technology, and big companies are racing to partner with or buy smaller AI firms to stay ahead. These deals can help them improve their own AI systems, but they also raise concerns about fairness and competition. If a few big companies control too much of the AI industry, smaller companies might struggle to compete, and innovation could slow down.
For now, Meta’s deal with Scale AI is moving forward, but the real test will be whether regulators decide to take a closer look. If they do, it could set an example for how future AI partnerships are handled in the US. The outcome could shape how tech giants invest in AI and whether they face stricter rules in the future.
The way this deal is handled could also influence other big tech companies planning similar partnerships. If regulators don’t step in, we might see more huge investments like this one. But if they decide to block or limit the deal, it could make companies think twice before making big moves in the AI space.
For now, all eyes are on Meta, Scale AI, and the US government to see what happens next. Will the deal go through without issues, or will regulators step in to keep competition fair? Only time will tell, but one thing is clear—AI is changing the tech world fast, and the rules are still being written.
