The UK competition watchdog, the Competition and Markets Authority (CMA), is increasing its scrutiny of the role of Big Tech companies in AI start-ups and has opened invitations to interested third parties to comment (ITCs) on the growing trend.
Third parties will have “the opportunity to give their views on whether the partnerships between Microsoft and Mistral AI, and Amazon and Anthropic, as well as Microsoft’s hiring of former employees and related arrangements with Inflection AI, fall within UK merger rules and the impact that these arrangements could have on competition in the UK”, the CMA said in a statement.
The watchdog will be stepping up the use of its merger control powers as part of its recent Foundation Models update.
Joel Bamford, executive director of mergers at the CMA, said: “Today we’re inviting comments into the partnerships between Microsoft and Mistral AI, Amazon and Anthropic, and Microsoft’s hiring of former employees and related arrangements with Inflection AI.
“We will assess, objectively and impartially, whether each of these three deals fall within UK merger rules and, if they do, whether they have any impact on competition in the UK.”
The announcement follows a recent publication by the CMA, which outlined three major risks impeding open, equitable and efficient competition within the AI Foundation Models (FMs) markets.
Specifically, it highlighted concerns regarding partnerships from key players “exacerbating existing positions of market power through the FMs value chain”.
Within its report, the CMA identified a complex network of more than 90 partnerships and strategic investments involving the same firms.
While these alliances have the potential for competitive growth in the UK market, the CMA remains attentive to the prospect that established Big Tech firms might exploit these partnerships and investments to insulate themselves from competitive pressures.
Bamford added: “Foundation Models have the potential to fundamentally impact the way we all live and work, including products and services across so many UK sectors – healthcare, energy, transport, finance and more.
“So open, fair, and effective competition in Foundation Model markets is critical to making sure the full benefits of this transformation are realised by people and businesses in the UK, as well as our wider economy where technology has a huge role to play in growth and productivity. ”
The CMA is also reviewing feedback received earlier this year surrounding Microsoft’s partnership with OpenAI, while also awaiting other requested information from involved parties.
