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The Competition and Markets Authority (CMA) has announced it is seeking views ahead of an examination into recent artificial intelligence (AI) deals by Microsoft and Amazon.
In recent years, Big Tech companies have been investing heavily in generative AI start-ups. Such partnerships and arrangements in the AI market have become a concern for the UK’s competition watchdog, the CMA.
The regulator has now invited “interested third parties” to comment on whether recent partnerships and arrangements concerning Microsoft and Amazon fall within UK merger rules and the impact these deals could have on competition in the UK.
This includes Microsoft’s partnership with French start-up Mistral AI, which was founded in April 2023 by previous employees of Meta Platforms and Google DeepMind.
Additionally, Microsoft has hired a significant amount of former employees from California start-up Inflection AI.
The CMA’s concerns with Amazon lies in its $4bn investment in Anthropic, a start-up founded by former members of ChatGPT creator OpenAI.
The deadline for third parties to comment is 9 May 2024. The CMA will then use these comments to assess whether to carry out any in-depth antitrust investigations.
“We will assess, objectively and impartially, whether each of these there deals fall within UK merger rules and, if they do, whether they have any impact on competition in the UK,” said Joel Bamford, executive director of mergers at the CMA.
He added: “The CMA recently committed to step up the use of its merger control powers as part of its recent AI foundation models update. While we remain open-minded, and haven’t drawn any conclusions, our aim is to better understand the complex partnerships and arrangements at play.”
The CMA is already examining Microsoft’s $13bn investment in ChatGPT developer OpenAI.
It’s not just the UK either – regulators across the globe are also examining partnerships and arrangements in AI markets. For example, the European Commission is assessing competition in ‘virtual worlds’ and generative AI and has called for information from several large digital players to ‘examine the market dynamics’ of partnerships in this space.
In the US, the Federal Trade Commission is leading an ongoing inquiry into generative AI investments by technology companies, to assess whether these ‘investments and partnerships pursued by dominant companies risk distorting innovation and undermining fair competition’.
In a report published in September 2023, the CMA warned of a lack of competition in the AI market.
