UK investigation sparked by Microsoft's employment of former Inflection AI employees.
July 16 (Reuters) - The formal inquiry into Microsoft's (MSFT.O) hiring of some former employees of Inflection AI and its cooperation with the firm has been initiated by Britain's antitrust regulator, the company announced on Tuesday.
Regulators worldwide have been paying more attention to possible anti-competitive behavior in the AI sector over the last eighteen months, and Microsoft's numerous agreements with smaller businesses are coming under growing scrutiny.
Mustafa Suleyman, a co-founder of Google DeepMind (GOOGL.O), was appointed head of the company's recently established artificial intelligence branch in March by the internet behemoth. It also employed several people from Inflection, the company he founded in 2022.
According to Reuters, Microsoft's share of the $650 million purchase included an agreement to pay Inflection. This gave it access to Inflection's AI models and made it possible for the business to pay back its investors, which included Bill Gates and former Google CEO Eric Schmidt.
"We are highly sure that the hiring of brilliant promotes competition and should not be treated as a merger," a Microsoft spokeswoman said in an email to Reuters in response to the UK Competition and Markets Authority's (CMA) probe.
We will give the UK Competition and Markets Authority the data it need in order to quickly address its inquiries."
The CMA will have until September 11th to choose whether or not to forward the deal for a more thorough examination. Advertisement Click to proceed.
Concerns had already been raised about Microsoft's alliances with well-known AI businesses like OpenAI and Mistral AI in France.
In an effort to allay the worries of American and British antitrust authorities regarding the degree of its control over the AI firm, it resigned its position as a board observer at OpenAI last week.
The CMA has also asked for opinions regarding joint ventures with Anthropic, Amazon (AMZN.O), and opens new tab.
