| 29 February 2024, Thursday |

Microsoft, OpenAI tie-up draws UK antitrust regulator scrutiny

For the second time this year, the antitrust body in Britain announced on Friday that it will consider whether to open a merger investigation into Microsoft’s multibillion-dollar collaboration with ChatGPT creator OpenAI.

The decision was made in response to Microsoft’s (MSFT.O) announcement in November that it will assume a non-voting role on the board and commit over $10 billion to OpenAI. That came after a turbulent boardroom conflict in which Sam Altman, the founder and CEO of OpenAI, was abruptly removed and later reappointed.

“There have recently been a number of developments in the governance of OpenAI, some of which involved Microsoft,” the Competition and Markets Authority (CMA) said on Friday.

Consequently, its review will consider whether the OpenAI tie-up has resulted in a merger situation, and if it could hurt UK competition, the CMA said.

Microsoft owns 49% of the for-profit operating company, according to sources familiar with the matter. OpenAI has a non-profit parent which owns 2%, those sources said.

The speed at which the use of AI technology is growing is unrivalled in economic history, while advances in powerful foundation models, such as the one underpinning ChatGPT mean that this is a pivotal moment in the development of this transformative technology, the CMA said.

  • Reuters