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December 8, 2023
Microsoft’s OpenAI partnership investigated by UK’s CMA

The United Kingdom’s (UK) Competition and Markets Authority (CMA) is investigating the partnership between Microsoft and OpenAI.

The competition regulator announced on Friday (Dec.8) it would consider if Microsoft’s partnership with the artificial intelligence (AI) firm behind ChatGPT has resulted in “a substantial lessening of competition” within the nation’s technology sector.

It’s not the first time the CMA has scrutinized the tech giant. The organization is already conducting a separate probe into the supply of public cloud infrastructure services after telecoms watchdog Ofcom flagged the dominance of Amazon and Microsoft.

The first stage of this latest investigation into Microsoft gives those involved and interested third parties to comment on the partnership between Microsoft and OpenAI and the impact that the merger could have on competition in the UK.

Sorcha O’Carroll, Senior Director for Mergers at the CMA said: “The invitation to comment is the first part of the CMA’s information-gathering process and comes in advance of launching any phase 1 investigation, which would only happen once the CMA has received the information it needs from the partnership parties.”

OpenAI and Microsoft partnership deepens

In November, OpenAI sought to expand its partnership with the world’s second most valuable company (behind Apple) and raise additional capital from the tech giant and other investors, according to CEO Sam Altman.

Earlier this year, Microsoft invested $10 billion in OpenAI, valuing the San Francisco-based startup at $29 billion. While not disclosing specific financial details, Altman indicated OpenAI has seen strong revenue growth in 2022 but remains unprofitable due to high research and development expenses associated with developing increasingly sophisticated AI models.

While OpenAI and ChatGPT remain the household names in the generative AI space, they have fierce competition looking to cut in. Google launched its most sophisticated AI yet; Gemini, in early December, Amazon has Q which is a chatbot aimed at business and Elon Musk has his own AI start-up called xAI.

The race is on to become the dominant force in AI, and for now, Microsoft and OpenAI have a headstart.

Featured Image: Photo by Jonathan Kemper on Unsplash 

The post Microsoft’s OpenAI partnership investigated by UK’s CMA appeared first on ReadWrite.

 

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