Investment
After UK, Microsoft’s OpenAI investment is under EU’s scanner
In December, the UK’s antitrust regulator announced that it is closely monitoring the partnership between Microsoft and OpenAI, and whether the developments regarding sacking and hiring of Sam Altman as the latter’s CEO has resulted in a relevant merger situation that may impact the competition in the UK. A month later, Microsoft financial backing for the ChatGPT maker may be subject to the European Union’s (EU’s) merger rules.
The EU is concerned about the competitiveness of virtual worlds and generative AI markets, and is worried that Microsoft’s investment could give it too much control over these markets. Notably, Microsoft has invested billions of dollars in OpenAI and has integrated its AI technology into some of its products, including Windows 11, its browser Edge and Bing search engine.
“We are inviting businesses and experts to tell us about any competition issues that they may perceive in these industries, whilst also closely monitoring AI partnerships to ensure they do not unduly distort market dynamics,” said Margrethe Vestager, European commissioner for competition.
The European Commission (EC) is looking into whether Microsoft’s investment in OpenAI, a leading artificial intelligence (AI) research lab, should be subject to an in-depth merger review.
Why the UK, EU is probing the investment
Last year, OpenAI faced internal struggles and the company board ousted Altman. Soon after the announcement, Microsoft offered Altman a job at the company. This apparently raised concerns about OpenAI’s ability to maintain its independence and objectivity in the face of Microsoft’s potential control over the AI company, given its close relationship and investment.
It’s important to note that the EC’s probe is still in its preliminary stages, and it’s unclear whether it will ultimately lead to any regulatory action.
The EU is concerned about the competitiveness of virtual worlds and generative AI markets, and is worried that Microsoft’s investment could give it too much control over these markets. Notably, Microsoft has invested billions of dollars in OpenAI and has integrated its AI technology into some of its products, including Windows 11, its browser Edge and Bing search engine.
“We are inviting businesses and experts to tell us about any competition issues that they may perceive in these industries, whilst also closely monitoring AI partnerships to ensure they do not unduly distort market dynamics,” said Margrethe Vestager, European commissioner for competition.
The European Commission (EC) is looking into whether Microsoft’s investment in OpenAI, a leading artificial intelligence (AI) research lab, should be subject to an in-depth merger review.
Why the UK, EU is probing the investment
Last year, OpenAI faced internal struggles and the company board ousted Altman. Soon after the announcement, Microsoft offered Altman a job at the company. This apparently raised concerns about OpenAI’s ability to maintain its independence and objectivity in the face of Microsoft’s potential control over the AI company, given its close relationship and investment.
It’s important to note that the EC’s probe is still in its preliminary stages, and it’s unclear whether it will ultimately lead to any regulatory action.
