UK Investigates Big Tech's AI Ventures over Competition Concerns

Wednesday, 24/04/2024 | 14:14 GMT by Jared Kirui

CMA is examining partnerships between Microsoft, Amazon, and AI startups.

Competition authorities globally are investigating AI-related activities due to their widespread implications.

The UK's competition regulator is scrutinizing the involvement of big technology companies in the AI sector. Concerns over competition and market dominance have prompted the Competition and Markets Authority (CMA) to probe partnerships of major firms like Microsoft, Amazon, and AI startups.

Risks to Competition

According to the press release, the CMA is seeking views specifically on the partnerships between Microsoft and Mistral AI, and Amazon and Anthropic. Additionally, Microsoft's hiring of former employees of Inflection AI is under scrutiny. The CMA emphasized that it has not reached conclusions on whether these deals violate the UK's merger rules or pose competition concerns.

Joel Bamford, the Executive Director of Mergers at the CMA, mentioned: "Today we're inviting comments into the partnerships between Microsoft and Mistral AI, Amazon and Anthropic, and Microsoft's hiring of former employees and related arrangements with Inflection AI. We will assess, objectively and impartially, whether each of these 3 deals fall within UK merger rules and, if they do, whether they have any impact on competition in the UK."

A recent report by the CMA highlighted the risks to fair competition in AI Foundation Models (FMs) markets. These risks include concerns that partnerships among major players may strengthen existing market dominance. Competition authorities worldwide are actively investigating AI-related activities due to their global implications.

Global Competition Authorities Scrutinize AI

"Open, fair, and effective competition in Foundation Model markets is critical to ensuring that the full benefits of this transformation are realized by people and businesses in the UK, as well as our wider economy, where technology has a huge role to play in growth and productivity," Bamford added. CMA is considering feedback on Microsoft's partnership with OpenAI.

In September 2023, Amazon announced a $4 billion investment in AI developer Anthropic to boost the development of advanced FMs. After fulfilling this commitment in March 2024, the e-commerce giant secured a minority stake in Anthropic and integrated AWS as its cloud service provider.

While the focus is on UK-based activities, companies like Microsoft and Google have been investing billions of dollars in AI development worldwide. These tech giants are expanding their AI footprint in countries, such as the United Arab Emirates, Spain, Germany, and France.