After Securing A Board Seat, Microsoft's OpenAI Partnership Comes Under The UK Antitrust Authority's Scanner

The UK’s Competition and Markets Authority (CMA) is seeking public feedback on the collaboration between Microsoft Corp. MSFT and OpenAI. The CMA aims to gauge whether this partnership has led to a merger situation impacting market competition.

What Happened: The CMA has initiated an “Invitation to Comment” (ITC), marking the first step in its information collection process. This follows various developments at OpenAI, some involving Microsoft.

The CMA is examining if the alliance between the tech behemoth and the AI research lab has created a merger-like situation and, if so, its potential effects on competition. The CMA is also evaluating whether the partnership has led to an acquisition of control.

See Also: Google Fires Biggest Salvo Against OpenAI With Gemini — And TikTok Parent Says ‘More Powerful’ Model Coming Anytime Now

Sorcha O'Carroll, Senior Director for Mergers at the CMA, posited that the ITC is a prelude to any phase 1 investigation. The authority will only move forward once it has collected all required information from the partnership entities.

Alongside this, the CMA continues its broader work to comprehend the implications of Foundation Models (FMs) for competition and consumer protection, with an update expected in March 2024. The CMA is also advancing with its cloud infrastructure market investigation.

Why It Matters: The scrutiny comes after a series of events at OpenAI that saw its former CEO Sam Altman regaining his position. At the same time, Microsoft secured a non-voting observer role on the OpenAI board, granting the company enhanced visibility into the AI start-up’s operations.

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