Britain’s competition watchdog has opened a preliminary investigation into Microsoft’s huge investment in OpenAI, creator of ChatGPT, over the tech giant’s relationship with one of the most important AI companies today, CNBC and News.ro reported.

The Competition and Markets Authority (CMA) said on Friday it was seeking views from stakeholders to determine whether Microsoft’s $10 billion investment in OpenAI led to an appropriate merger situation where two or more businesses have ceased or ceased to be separate as a result of the transaction.

The CMA said the pace at which AI is expanding is “unparalleled in the history of economics” and that advances in so-called core models that describe general-purpose AI tools such as ChatGPT are “a key moment in the development of these transformative technologies”. “.

The regulator said it will examine whether Microsoft’s partnership with OpenAI led to the acquisition of control, in other words, a situation where one company has significant influence, actual control or more than 50% of the voting rights over others.

“The invitation to comment is the first part of the CMA’s information-gathering process and comes before the start of any Phase 1 investigation, which will take place only after the CMA receives the necessary information from the partnership parties,” said Sorcha O’Carroll, senior director of mergers at CMA, in a statement.

The departure and return of Sam Altman

The CMA may have taken particular notice of the removal of OpenAI CEO Sam Altman from the board of directors of the company he co-founded last month.

Altman was fired from OpenAI in a shock move at one of the companies at the center of the AI ​​boom in 2023.

At the time, OpenAI’s board of directors said it was “no longer confident” in Altman’s ability to continue running OpenAI.

Microsoft, which has an extensive partnership with OpenAI, later hired Altman to lead a new cutting-edge AI research group.

The move sparked outrage among OpenAI employees and calls for Altman’s return.

Within days, Altman returned to OpenAI as CEO, and Microsoft was given a non-voting board seat.

A designated Microsoft board representative may attend OpenAI board meetings and have access to confidential information. But he does not have the right to vote, including in the election of directors.

Microsoft says it will cooperate

Microsoft president and vice president Brad Smith, responding to the CMA announcement, referenced Google’s 2014 acquisition of British artificial intelligence lab DeepMind, saying Microsoft’s partnership with OpenAI is different from that deal.

“Since 2019, we have created a partnership with OpenAI that encourages more innovation and competition in the field of artificial intelligence, while maintaining the independence of both companies. The only thing that has changed is that Microsoft will now have a non-voting observer on the OpenAI board, which is very different from an acquisition like Google’s acquisition of DeepMind in the UK. We will be working closely with the CMA to provide all necessary information,” Smith said.

The CMA cited Google’s takeover of DeepMind, which at the time was worth more than 400 million pounds ($502.7 million). Some tech investors believe that DeepMind could become much more valuable over time, especially given that the hype around AI has reached dizzying heights.

Separately, the CMA is analyzing the AI ​​industry to assess what risks and opportunities the underlying models present and what principles should be applied to the technology to prevent distortions of competition and consumer protection (photo source Dreamstime)