The UK’s Competition and Markets Authority (CMA) and the US Federal Trade Commission (FTC) are scrutinizing Microsoft’s (NASDAQ:MSFT) multibillion-dollar partnership with OpenAI. The investigation aims to determine whether the collaboration has resulted in a relevant merger situation. While the CMA has initiated an information-gathering process, the FTC is reportedly looking into Microsoft’s investment in OpenAI, though no formal investigation has been launched yet.
The CMA has invited comments from Microsoft, OpenAI, and other interested parties, including competitors and customers. The investigation will focus on factors such as the size of the investment, influence on decision-making, and a change in control. Microsoft’s recent involvement in OpenAI’s boardroom changes has drawn regulatory attention.
Microsoft’s investment of up to $13 billion for a 49% stake in OpenAI’s for-profit arm makes it the largest backer of the AI company. The collaboration has integrated OpenAI’s technology into various Microsoft products, leveraging the former’s access to Microsoft’s vast cloud computing resources. The investigation will unfold over the coming months.
Microsoft continues to enhance its generative AI capabilities, recently integrating OpenAI’s DALL-E 3 AI image-synthesis model into its offerings. The company’s efforts in the generative AI space pose a competitive threat to companies like Alphabet (NASDAQ:GOOG), Meta Platforms (NASDAQ:META), and Amazon (NASDAQ:AMZN).
The investigation highlights the increasing scrutiny of Big Tech deals and antitrust concerns in the AI market, with regulatory bodies in the UK, US, and EU closely monitoring developments.
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