AI Startups Ramping Up Federal Lobbying Efforts

Amid the generative AI boom and an election year, AI startups are ramping up their lobbying efforts at the federal level.

According to new data from OpenSecrets, the number of groups lobbying the government on AI issues rose from 459 in 2023 to 556 in the first half of 2024.

Increased Spending by Major Players

Top AI startups have significantly increased their lobbying expenditures. OpenAI spent $800,000 in the first half of 2024 alone, up from $260,000 in all of 2023.

The company has expanded its team of outside lobbyists from three to about 15 within this period. This includes hiring former Republican Sen. Norm Coleman to focus on research and development concerns.

Building Internal Policy Teams

OpenAI has also strengthened its internal policy team, bringing in Chan Park, a former senior director of congressional affairs at Microsoft, to lead U.S. and Canada partnerships. Their global affairs division has grown to 35 employees across eight countries and plans to reach 50 by year-end.

Other significant law firms, such as Akin Gump Strauss Hauer & Feld and DLA Piper, have also registered lobbyists for OpenAI.

Anthropic and Smaller Firms

Anthropic, a rival to OpenAI, is expected to spend half a million dollars on lobbying in the coming months.

In 2024 alone, Anthropic invested $250,000 in a five-lobbyist team, nearly matching their total spend from 2023.

The company has onboarded several notable lobbyists, including former AWS lobbyist Stoney Burke and Jed Bhuta of Tower 19, while also hiring in-house lobbying talent.

Cohere’s Efforts and Impact

Even smaller firms are joining the trend. Cohere has increased its lobbying spend to $120,000 in the first half of 2024, up from $70,000 last year.

Cohere focuses on building custom generative AI models for enterprise customers, a narrower market compared to OpenAI or Anthropic.

Implications of Election Year

Lobbying is intensifying due to the upcoming elections. Both leading presidential nominees have differing views on AI regulation, which is drawing attention from AI startups.

Vice President Kamala Harris supports federal oversight of AI, aligning with President Biden. On the other hand, former President Donald Trump advocates for deregulation.

Federal and State Legislative Actions

This week, the U.S. Commerce Department released a report that could indicate a future direction for AI regulation under a Harris administration.

While Congress has yet to pass comprehensive AI legislation, nearly 400 state-level AI laws have been proposed in 2024, showing a strong push for regulation at various government levels.

AI Firms’ Legislative Preferences

OpenAI is showing greater activism in matters of AI regulation, supporting Senate bills that propose the establishment of a federal AI rulemaking body and providing scholarships for AI R&D.

The company is also focusing on educational resources, aiming to introduce AI education in colleges and K-12 schools.

Antitrust Concerns

OpenAI, along with other AI startups, is facing potential antitrust scrutiny from U.S. regulators like the Department of Justice and the Federal Trade Commission (FTC).

The FTC is particularly interested in Amazon’s partnership with AI startup Adept and Microsoft’s acquisition of talent from Inflection. Microsoft, a major investor in OpenAI, has even given up an observer seat on OpenAI’s board, likely to ease regulatory concerns.

AI startups are increasingly active in federal lobbying as they navigate the evolving landscape of AI regulation and potential antitrust scrutiny.

These efforts highlight the industry’s determination to influence policy and shape the future of AI in the U.S.

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Emmanuel Kesse

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