Meta gives up control of Chinese AI startup Manus after eight months

Chinese AI startup Manus will operate as an independent company after Meta Platforms Inc. agreed to unwind its acquisition, following a block by China's National Development and Reform Commission in April over export control concerns. Manus said Tuesday it will delete some user data collected during its time under Meta to meet regulatory requirements, highlighting the challenges US and Chinese companies face in cross-border AI deals.

Chinese AI company Manus has laid out its plans to operate as an independent company following the reversal of its acquisition by Meta. The US social media company agreed to buy Manus last year https://www.computerworld.com/article/4112046/meta-buys-high-profile-ai-startup-manus.html but Chinese regulators quickly opened an investigation into the deal https://www.computerworld.com/article/4113806/chinese-authorities-scrutinize-metas-purchase-of-ai-startup-manus.html , as they were concerned that it violated Chinese export controls. In April, China’s National Development and Reform Commission blocked https://www.bbc.co.uk/news/articles/cj0v0gr2yz7o the purchase. Manus will now revert to being an independent company and to meet with regulatory requirements must delete some user data collected while it was part of Meta https://manus.im/blog/a-note-to-our-users , it said Tuesday. The failure of the deal illustrates the problems that US and Chinese companies are having as they attempt to build a hold on the AI market. While regulatory authorities in China don’t want Manus under US ownership, US authorities are equally suspicious of China’s role in AI development. The US administration fired a warning shot this March https://www.csoonline.com/article/4141989/trumps-cyber-strategy-emphasizes-offensive-operations-deregulation-ai.html by unveiling a new cybersecurity policy, a move which was prompted by suspected Chinese involvement in a cyber-attack on the FBI https://www.wsj.com/politics/national-security/china-suspected-in-breach-of-fbi-surveillance-network-2c9d1691 . Also in March, the US-China Economic and Security Review Commission warned https://www.computerworld.com/article/4149313/chinas-use-of-open%E2%80%91source-ai-threatens-the-us-lead-in-ai-development-us-commission-warns.html that Chinese use of open-source AI tools could lead to an economic advantage that the US couldn’t counter through regulation. And last year , US and Chinese authorities played a cat-and-mouse game https://www.networkworld.com/article/4117031/yea-or-nay-will-nvidia-h200-chips-go-to-china.html over Nvidia chip exports. Customers of AI vendors in both countries may need to be wary about future cross-border acquisitions as the two superpowers jostle for a technological lead.