The CMA's investigation comes amid concerns that partnerships, investments, and "acqui-hires" could be a way for big tech firms to bypass regulatory scrutiny. Microsoft's investment in and partnership with OpenAI, its hiring of the team behind Inflection AI, and its investment in Mistral AI have all come under scrutiny. Amazon's recent $4 billion investment in Anthropic, an AI company working on large language models, is also being reviewed by the CMA.
Key takeaways:
- The U.K.’s Competition and Markets Authority (CMA) is investigating whether the partnerships and hiring practices involving Microsoft, Amazon, and three AI startups fall within its merger rules and could impact competition in the U.K. market.
- The investigation comes amid increasing scrutiny of Big Tech's approach to M&A in the AI world, with critics arguing that 'quasi-mergers' are being used to bypass regulatory oversight.
- The CMA is particularly interested in 'foundation models', the underlying infrastructure on which other AI systems are built, and whether competition in these markets is being stifled.
- Microsoft and Amazon's investments and partnerships with various AI startups have drawn the attention of the CMA, with the regulator inviting comments from relevant parties as part of its investigation.