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Advocacy Groups Urge FTC to Probe Meta’s $14.3 Billion Investment in Scale AI

By  |  August 7, 2025

A coalition of consumer advocacy and competition watchdog organizations is calling on the Federal Trade Commission (FTC) to investigate Meta’s recent multibillion-dollar investment in artificial intelligence firm Scale AI. In a letter sent Thursday to FTC Chair Andrew Ferguson and obtained by Axios, the groups argue the deal could be a strategic move to sidestep antitrust scrutiny.

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    Meta revealed in June that it was investing $14.3 billion to acquire a 49% stake in Scale AI, a company known for producing training data for machine learning models. As part of the transaction, Meta also hired several top Scale AI staffers. Alexandr Wang, Scale AI’s CEO, is expected to join Meta to contribute to its superintelligence initiatives.

    According to Axios, the advocacy groups contend that Meta’s minority investment structure is specifically designed to avoid regulatory oversight. Because the stake is just under the 50% threshold that would trigger mandatory reporting requirements, the transaction could fly under the radar of federal enforcers.

    The letter criticizes what it calls Meta’s “buy or bury” approach to emerging technologies and describes the deal as a “de facto vertical acquisition” that exploits loopholes in existing laws. The groups warn that the arrangement could allow Meta access to sensitive business and technical information, potentially stifling competition in the fast-growing AI sector.

    Read more: Italian Regulator Probes Meta Over Alleged AI Monopoly Tactics on WhatsApp

    “This is a familiar playbook which includes key aspects typical of Big Tech’s minority investments in generative AI companies,” the letter states, per Axios. The signatories include Public Citizen, the Tech Oversight Project, the Consumer Federation of America, and the American Economic Liberties Project.

    The concern isn’t limited to AI development. Critics believe the deal may have broader implications for Meta’s influence in other sectors. Sumit Sharma, executive director of NextGen Competition, noted that the investment could reinforce Meta’s stronghold in areas such as social media and surveillance advertising—markets where the company is already facing antitrust lawsuits.

    “Do we really want Mark Zuckerberg and Meta to have even more control over our information ecosystem?” Sharma asked, referencing Meta’s ongoing legal challenges.

    Per Axios, the letter also draws attention to a January FTC report that cautioned against AI partnerships potentially enabling dominant firms to access valuable partner data, which could hinder competition and innovation.

    While Meta has defended the partnership as a way to collaborate more closely on AI model development, the groups behind the letter are urging the FTC to scrutinize whether the deal aligns with the agency’s stated goals of preventing market consolidation and promoting fair competition—especially at a time when AI regulation remains limited.

    Source: AXIOS