The UK’s Competition and Markets Authority (CMA) has given the green light to Microsoft Corp.’s $13 billion investment in OpenAI Inc., resolving months of regulatory review.
The CMA concluded that the 2023 deal did not warrant a full-scale investigation based on merger rules. Initially, the CMA had expressed interest in assessing whether the partnership granted either company undue influence over the other.
“The CMA found that while Microsoft did acquire material influence over OpenAI in 2019, there has not been a change of control by Microsoft,” the regulatory body stated.
This decision comes roughly 14 months after the CMA began scrutiny of the alliance, and alleviates one source of regulatory concern for Microsoft, which is also facing an ongoing probe into its cloud service offerings. Furthermore, the CMA’s announcement follows shortly after the US Federal Trade Commission (FTC) voiced concerns that the investment could extend Microsoft’s dominance in cloud computing to the emerging artificial intelligence sector.
Microsoft’s strategic bet on OpenAI has allowed the software giant to gain an early advantage over its competitors in the tech sector, integrating OpenAI’s products throughout its core business operations.
Both Microsoft and Apple Inc. made the decision last year to forgo board positions at OpenAI, a move that highlighted the increasing regulatory oversight of these types of deals. The CMA has been a leader among global regulators working to ensure that Big Tech’s investments in the AI industry do not distort the market or lead to a concentration of power in the hands of a few large corporations. The UK agency had previously raised concerns about the “interconnected web” of partnerships and investments in the AI ecosystem. It has already approved Google’s partnership with the AI firm Anthropic.
