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UK eyes antitrust investigation into OpenAI’s partnership with Microsoft

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UK eyes antitrust investigation into OpenAI's partnership with Microsoft

The UK’s got its eyes on Microsoft and OpenAI, and things are heating up. Word on the street is, the government’s mulling over an antitrust probe into their partnership.

Why? Well, there’s chatter that their deal, which played a key part in solving OpenAI’s headline-grabbing leadership shakeup, might be a bit of a game-changer for market competition.

The folks at the Competition and Markets Authority aren’t taking this lightly. They’re putting out feelers, asking the public if they should dive into investigating this “close, multi-faceted relationship.” Is it a merger in disguise? That’s the big question.

Microsoft’s stance? OpenAI’s still flying solo. “We’ve been buddies with OpenAI since 2019, sparking more AI innovation and competition, all while staying independent,” says Brad Smith, Microsoft’s VP and president.

He took to X (you know, the platform once called Twitter) to make his point. Microsoft’s new non-voting seat on OpenAI’s board? Smith says it’s nothing like Google gobbling up DeepMind. They’re ready to cooperate with the CMA, laying all their cards on the table.

Over at OpenAI, they’re singing a similar tune. A spokesperson there says their Microsoft partnership fuels their AI research, keeping them competitive and independent. Microsoft’s board observer? Just a seat at the table, no control or governing power.

This announcement signals the UK ramping up its scrutiny of Microsoft. The CMA’s had its magnifying glass on Microsoft’s cloud services and its merger with gaming behemoth Activision Blizzard. That deal got the green light this fall, but only after Microsoft tweaked a few things.

Let’s talk investments. Microsoft’s poured billions into OpenAI, weaving its tech into Microsoft’s own offerings. Satya Nadella, Microsoft’s chief, says they’re joined at the hip with OpenAI.

Amidst the drama of OpenAI CEO Sam Altman getting fired and rehired, Nadella emphasized Microsoft’s deep involvement and respect for OpenAI’s independence.

“We’re all in on their mission,” Nadella told CNN’s Kara Swisher on her podcast last November. “Their independence? We’re totally cool with it.”

The CMA’s blog post lays it out: “We’ve seen some changes in OpenAI’s governance, some with Microsoft’s involvement.

So, we’re sending out an invitation to comment to figure out if this partnership, with all its recent twists, might actually be a merger and what that means for competition.”

They’re zeroing in on whether Microsoft’s got the real power over OpenAI. The CMA’s process is pretty standard: start with public feedback, then possibly launch a full-blown investigation. Stay tuned, because this saga’s just getting started.

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