FTC Investigates AI Chatbots’ Impact on Children

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Seven tech giants face inquiry over chatbot safety

The Federal Trade Commission (FTC) announced Thursday that it has launched an investigation into seven major technology companies—including OpenAI, Alphabet, Meta, Snap, xAI, and Character Technologies—to assess the potential risks their AI chatbots pose to children and teens. The probe will examine how these tools simulate human-like conversations and form interpersonal bonds, potentially affecting young users’ mental health and development.

FTC Chairman Andrew Ferguson emphasized the agency’s dual commitment to child protection and innovation. He noted that while AI development is a national priority, ensuring safety and ethical standards is paramount, particularly for vulnerable users.

Key concerns include safety, monetization, and data use

The FTC is seeking detailed information on how companies design, monitor, and monetize their AI companions. It wants to understand how characters are developed, what personal data is collected or shared, and what safeguards are in place to prevent harmful interactions. The agency is also examining how these companies enforce their terms of service and mitigate negative outcomes, such as inappropriate conversations or emotional dependency.

OpenAI responded by reaffirming its commitment to safety, particularly where youth are concerned. Snap also expressed support for thoughtful AI policy development. Meta declined to comment, while Alphabet and xAI have not yet responded.

Mounting ethical concerns amid AI companion boom

Since ChatGPT’s debut in 2022, the AI chatbot space has grown rapidly, prompting ethical questions and privacy fears. Some bots, including those from Meta, have already faced backlash for engaging in romantic or suggestive conversations with minors. One Reuters investigation highlighted troubling examples, including a chatbot that described an eight-year-old as a “masterpiece.”

Meta has since introduced restrictions to avoid romantic discussions or conversations on topics like self-harm and eating disorders. OpenAI, facing a wrongful death lawsuit, has also promised changes to how ChatGPT responds in sensitive situations.

AI companions backed by industry leaders

Despite safety concerns, high-profile figures like Elon Musk and Mark Zuckerberg continue to push the development of AI companions. Musk’s xAI introduced a paid “Companions” feature on its Grok chatbot, while Zuckerberg has said that personalized AI could become socially normalized and add real value to users’ lives.

The FTC’s move comes amid growing pressure from lawmakers. Senator Josh Hawley has opened an investigation into Meta following reports of inappropriate chatbot behavior. As the AI companion market evolves, the FTC’s findings may shape regulatory frameworks and determine the future of AI-human interactions, especially among young users.

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