FTC Investigates AI Companions: OpenAI, X, Meta, Google, Snap, IG and Character (www.ftc.gov)

The Federal Trade Commission (FTC) has launched an inquiry into seven major companies—OpenAI, Alphabet (Google), Meta, Snap, Instagram, X.AI, and Character Technologies—regarding how they manage potential risks posed by their AI-powered chatbots, particularly on children and teens. These generative AI chatbots are designed to simulate human-like interaction, often fostering emotionally engaging relationships that could influence younger users. The FTC’s investigation aims to assess how these firms evaluate chatbot safety, limit exposure to minors, and inform users and parents about associated risks. This action is significant for the AI/ML community as it highlights increasing regulatory scrutiny focused on the ethical deployment and social impact of conversational AI, especially in protecting vulnerable populations. Using its broad 6(b) authority, the FTC seeks detailed information on how these companies develop and deploy AI companions, including their monetization models, data handling practices, content moderation, and compliance with child privacy laws like COPPA. The inquiry underscores the importance of robust monitoring and mitigation strategies before and after product launch to prevent harm. Technically, the FTC is probing how chatbots process user inputs, generate outputs, and monitor for adverse effects while employing transparency around data use and advertising. This investigation could shape future AI design standards, emphasizing safety, user disclosures, and age-appropriate content restrictions. For developers and stakeholders, it signals a growing mandate to balance innovation with accountability in AI companionship technologies.