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Microsoft and OpenAI’s Relationship Escapes EU Merger Probe

EU approves Microsoft-OpenAI partnership despite initial scrutiny. Regulators in other countries are still reviewing the deal.

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The European Commission has reportedly concluded its preliminary examination into the partnership between Microsoft and OpenAI, deciding not to initiate a formal investigation. This decision comes after considerations on whether the amounted to a merger, given the significant investments and the strategic nature of their relationship. Despite the scrutiny, the Commission found that operates independently of , alleviating concerns of undue control or merger conditions.

Global Regulatory Interest

While the European Union has opted not to pursue further action, the partnership between Microsoft and OpenAI continues to attract attention from regulatory bodies worldwide. The United States Federal Trade Commission, as of January, has been reviewing tech companies' investments in artificial intelligence, including Microsoft's engagements with OpenAI. Similarly, the UK's Competition and Markets Authority announced in December 2023 its intent to solicit opinions on whether the Microsoft-OpenAI relationship constitutes a “relevant merger situation,” though updates on this inquiry remain pending.

Expanding AI Partnerships

Amidst regulatory examinations, Microsoft remains focused on broadening its artificial intelligence portfolio beyond its collaboration with OpenAI. A notable step in this direction is a multi-year agreement with France-based Mistral AI, which includes a minor investment. This move signifies Microsoft's commitment to diversifying its AI investments and partnerships, ensuring a robust position in the rapidly evolving AI landscape.

In a dramatic turn of events within OpenAI, the board's decision to dismiss co-founder and CEO Sam Altman in November 2023 was quickly reversed, leading to Altman's reinstatement and the board's resignation. Subsequently, OpenAI granted Microsoft a non-voting position on its newly formed board of directors, symbolizing a continued but evolving partnership.

As Microsoft and OpenAI navigate their partnership amidst global regulatory landscapes, their collaboration remains a focal point for discussions on the future of artificial intelligence and its governance. The decisions made by entities like the European Commission and ongoing inquiries by other regulatory bodies underscore the complex interplay between innovation, market competition, and regulatory oversight in the burgeoning field of AI.

SourceBloomberg
Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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