Competition watchdogs examine partnership between Microsoft and OpenAI

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OpenAI CEO Sam Altman (left) with Microsoft CEO Satya Nadella: in the sights of competition watchdogs

Photo: Barbara Ortutey / dpa

The power poker at the AI startup OpenAI caused an uproar - and now has an antitrust aftermath: The British competition authority CMA says it wants to examine whether the investments of the US software company Microsoft in the ChatGPT developer amount to a takeover.

Its EU counterpart said it was closely monitoring who was in control of OpenAI and whether there were any changes. The U.S. antitrust regulator FTC is also interested in the case, the Bloomberg news agency reported.

"Recently, there have been a number of developments in OpenAI's leadership that have also involved Microsoft," the CMA said. In the light of those events, it is examined whether the cooperation should be regarded as a merger and what effects this would have on competition. For this reason, competitors such as Alphabet subsidiary Google could submit comments on the issue until January 3, 2024.

"It is crucial that antitrust authorities swiftly investigate and, if necessary, reverse these agreements in order to preserve competition and prevent this important new technology from being monopolized," said Max von Thun, Europe director of the Open Markets Institute. This non-profit organization is committed to strengthening competition law.

Microsoft sees no antitrust concerns

Microsoft President Brad Smith pointed out in response to the CMA announcement that the company does not have voting rights on OpenAI's board of directors. "This differs significantly from Google's acquisition of AI specialist Deepmind." However, all the required information will be made available.

Microsoft could not be reached for comment on possible FTC investigations, nor could the U.S. authority. OpenAI did not respond to any requests for comment.

A few weeks ago, OpenAI surprisingly fired its CEO Sam Altman. He then moved to Microsoft before returning to his old post a few days later. Microsoft is a major shareholder in OpenAI. At the beginning of 2023, the Group significantly expanded its stake and has so far invested a total of more than ten billion dollars in the artificial intelligence (AI) specialist. According to insiders, Microsoft thus secured almost half of OpenAI's shares.

mic/Reuters