Meta, the big boss of Facebook, just put down a huge $14.8 billion to back Scale AI, a young firm that tags data. With this move, Scale AI’s big boss will join Meta, shaking up how Trump's team deals with deals that mainly buy a firm for its smart people.
Just out, this is Meta's second-biggest spend. It gets Meta a 49% share in Scale AI that can't vote. Scale AI uses gig folks to tag data by hand, key for making smart machines clever, and works with Meta rivals like Microsoft and OpenAI.
Since Meta’s not taking full control, U.S. rules watchers won’t auto-check this deal. Yet, they might still peek in if they think the deal dodges their watch or if it could quash market play.
The deal seems set to dodge usual rule fears, like cutting off rivals from Scale's services or letting Meta peek into competitors' plans. Still, Google has cut ties with Scale AI due to Meta's jump-in, and others might pull back too.
Scale AI says it's still strong and guards all client data tight. Alexandr Wang, who is 28 and leads Scale AI, will sit with Meta but keep a spot on Scale’s board with a lid on what he can see.
Experts think tech giants might get a warmer rule scene for AI deals with Trump than under Biden. Trump’s rule team, not keen to over-do rules on AI making, they still eye big tech kid gloves.
William Kovacic, a law guru at George Washington University, says rule keepers will keep a close watch, but that doesn't mean they'll jump in.
Past looks by the Federal Trade Commission (FTC) at similar hiring deals, like Amazon’s and Microsoft’s, have slowed under Biden. Amazon closed without a buzz, and no FTC move against Microsoft yet, but they’re still watching Microsoft close.
David Olson, a rule man at Boston College Law School, says Meta's pick of a small, nonvoting stake is smart to maybe dodge rule fights; yet, the FTC could still review.
Critics exist. U.S. Senator Elizabeth Warren wants a hard look, saying if the deal kills fair play or lets Meta unfairly rule the market, it should be blocked.
While Meta faces a big FTC lawsuit already, it's not clear if this Scale AI investment will draw more FTC eyes. Meanwhile, the Justice Department’s rule section is checking Google's new chatbot deal for skipping rule checks.
