As long as there has been AI, there have been people sounding alarms about what it might do to us: rogue superintelligence, mass unemployment, or environmental ruin from data center sprawl. But this week showed that another threat entirely—that of kids forming unhealthy bonds with AI—is the one pulling AI safety out of the academic fringe and into regulators’ crosshairs.

This has been bubbling for a while. Two high-profile lawsuits filed in the last year, against Character.AI and OpenAI, allege that companion-like behavior in their models contributed to the suicides of two teenagers. A study by US nonprofit Common Sense Media, published in July, found that 72% of teenagers have used AI for companionship. Stories in reputable outlets about “AI psychosis” have highlighted how endless conversations with chatbots can lead people down delusional spirals.

It’s hard to overstate the impact of these stories. To the public, they are proof that AI is not merely imperfect, but a technology that’s more harmful than helpful. If you doubted that this outrage would be taken seriously by regulators and companies, three things happened this week that might change your mind.

A California law passes the legislature

On Thursday, the California state legislature passed a first-of-its-kind bill. It would require AI companies to include reminders for users they know to be minors that responses are AI generated. Companies would also need to have a protocol for addressing suicide and self-harm and provide annual reports on instances of suicidal ideation in users’ conversations with their chatbots. It was led by Democratic state senator Steve Padilla, passed with heavy bipartisan support, and now awaits Governor Gavin Newsom’s signature. 

There are reasons to be skeptical of the bill’s impact. It doesn’t specify efforts companies should take to identify which users are minors, and lots of AI companies already include referrals to crisis providers when someone is talking about suicide. (In the case of Adam Raine, one of the teenagers whose survivors are suing, his conversations with ChatGPT before his death included this type of information, but the chatbot allegedly went on to give advice related to suicide anyway.)

Still, it is undoubtedly the most significant of the efforts to rein in companion-like behaviors in AI models, which are in the works in other states too. If the bill becomes law, it would strike a blow to the position OpenAI has taken, which is that “America leads best with clear, nationwide rules, not a patchwork of state or local regulations,” as the company’s chief global affairs officer, Chris Lehane, wrote on LinkedIn last week.

The Federal Trade Commission takes aim

The very same day, the Federal Trade Commission announced an inquiry into seven companies, seeking information about how they develop companion-like characters, monetize engagement, measure and test the impact of their chatbots, and more. The companies are Google, Instagram, Meta, OpenAI, Snap, X, and Character Technologies, the maker of Character.AI.

The White House now wields immense, and potentially illegal, political influence over the agency. In March, President Trump fired its lone Democratic commissioner, Rebecca Slaughter. In July, a federal judge ruled that firing illegal, but last week the US Supreme Court temporarily permitted the firing.

“Protecting kids online is a top priority for the Trump-Vance FTC, and so is fostering innovation in critical sectors of our economy,” said FTC chairman Andrew Ferguson in a press release about the inquiry. 

Right now, it’s just that—an inquiry—but the process might (depending on how public the FTC makes its findings) reveal the inner workings of how the companies build their AI companions to keep users coming back again and again. 

Sam Altman on suicide cases

Also on the same day (a busy day for AI news), Tucker Carlson published an hour-long interview with OpenAI’s CEO, Sam Altman. It covers a lot of ground—Altman’s battle with Elon Musk, OpenAI’s military customers, conspiracy theories about the death of a former employee—but it also includes the most candid comments Altman’s made so far about the cases of suicide following conversations with AI. 

Altman talked about “the tension between user freedom and privacy and protecting vulnerable users” in cases like these. But then he offered up something I hadn’t heard before.

“I think it’d be very reasonable for us to say that in cases of young people talking about suicide seriously, where we cannot get in touch with parents, we do call the authorities,” he said. “That would be a change.”

So where does all this go next? For now, it’s clear that—at least in the case of children harmed by AI companionship—companies’ familiar playbook won’t hold. They can no longer deflect responsibility by leaning on privacy, personalization, or “user choice.” Pressure to take a harder line is mounting from state laws, regulators, and an outraged public.

But what will that look like? Politically, the left and right are now paying attention to AI’s harm to children, but their solutions differ. On the right, the proposed solution aligns with the wave of internet age-verification laws that have now been passed in over 20 states. These are meant to shield kids from adult content while defending “family values.” On the left, it’s the revival of stalled ambitions to hold Big Tech accountable through antitrust and consumer-protection powers. 

Consensus on the problem is easier than agreement on the cure. As it stands, it looks likely we’ll end up with exactly the patchwork of state and local regulations that OpenAI (and plenty of others) have lobbied against. 

For now, it’s down to companies to decide where to draw the lines. They’re having to decide things like: Should chatbots cut off conversations when users spiral toward self-harm, or would that leave some people worse off? Should they be licensed and regulated like therapists, or treated as entertainment products with warnings? The uncertainty stems from a basic contradiction: Companies have built chatbots to act like caring humans, but they’ve postponed developing the standards and accountability we demand of real caregivers. The clock is now running out.

This story originally appeared in The Algorithm, our weekly newsletter on AI. To get stories like this in your inbox first, sign up here.