Recently, the UK Competition and Markets Authority (CMA) announced that it would end its investigation into the partnership between Microsoft and OpenAI, believing that the cooperation does not comply with the merger standards under the Enterprise Act of 2002. In the statement, the CMA said it was not believed that Microsoft currently controls OpenAI's business policies, given that all the available evidence, especially some recent changes, have made OpenAI's less dependent on Microsoft's computing power.
The CMA investigation began in December 2023, when the agency wanted to know whether Microsoft's $100 million investment in OpenAI constituted a related merger. As artificial intelligence technology becomes rapidly popular among enterprises, governments are working hard to find appropriate regulatory methods. In a decision this week, CMA acknowledged the complexity of regulating the AI industry, saying: "The AI industry is still growing rapidly." During the investigation, CMA noted that the partnership between Microsoft and OpenAI is changing.
In this review, the CMA considers the business reality between Microsoft and OpenAI and the formal terms of the agreement between the parties. In January, Microsoft adjusted some of OpenAI's exclusive obligations, including allowing OpenAI to build additional computing power so it can drive projects such as the $500 billion Stargate infrastructure program. Microsoft mentioned in the announcement that the new agreement also includes an exclusive change in the new computing power and is converted to a model where Microsoft has the right to buy it.
In response, Microsoft said in a statement that it welcomed the CMA's conclusion, saying that the decision was based on careful consideration of business reality and marked the end of the investigation. In addition, CMA has also focused on collaborations between other big tech companies and AI companies, such as Microsoft's licensing agreement with French AI startup Inflection. Last September, the CMA approved Microsoft to recruit top talents from Inflection and establish a new Microsoft AI division, further consolidating its layout in the AI field.
Key points:
1⃣ CMA believes that Microsoft’s cooperation with OpenAI does not constitute a merger and ends the investigation.
2⃣ Regulators emphasize that the AI industry is developing rapidly and that cooperative relationships are changing.
3⃣ Microsoft has adjusted its protocol with OpenAI to give it greater independence.