OpenAI and Microsoft could face antitrust probe from UK competition watchdog
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The news: The UK’s Competition and Markets Authority (CMA) has called for contributions from stakeholders to decide whether the partnership between OpenAI and Microsoft should be investigated over competition concerns.
The numbers: In September this year, OpenAI courted investors about a potential share sale that would value the company at up to USD90 billion ($136.72 billion), triple the valuation it achieved in January 2023. Microsoft made its first investment in OpenAI in 2019, growing to USD13 billion to date.
The context: Just weeks after the OpenAI board fired and then reinstated CEO Sam Altman, exposing the strong connection between the AI giant and Microsoft, the CMA has launched an Invitation to Comment for the parties and interested third parties to voice their opinions on the partnership.
Microsoft has not only invested heavily into the tech giant, but integrates OpenAI products into many areas of its operations, while OpenAI relies on Microsoft’s significant cloud power to drive its services.
In light of the recent events, the CMA seeks to review whether the partnership amounts to one party having material influence, de facto control or over 50% of the voting rights over another entity. If that were the case, the watchdog would be likely to prompt an antitrust investigation into the two companies. Earlier this year the CMA signed-off on Microsoft’s acquisition of gaming giant Activision Blizzard (the last major antitrust regulatory authority to do so) following an extensive two-year investigation.
The source: UK Competition and Markets Authority
