Specifically, the CMA is asking all stakeholders whether the collaboration between the two, including recent developments, has resulted in a relevant merger situation and, if so, what impact that the merger could have on competition in the UK.
“The invitation to comment is the first part of the CMA’s information gathering process and comes in advance of launching any phase 1 investigation, which would only happen once the CMA has received the information it needs from the partnership parties,” said Sorcha O’Carroll, senior director for Mergers at the CMA.
The Invitation to Comment (ITC) is the first part of the CMA’s information gathering process and precedes a formal phase 1 investigation.
The move comes as the development and use of artificial intelligence (AI) continues at pace, while advances in foundation models (FMs) mean it is a critical time for this technology. In its recent report, the CMA found both opportunities and risks for competition and consumer protection, in the development of FMs.
Chief among these is the need for sustained competition between AI developers which will help to deliver innovation, growth and responsible practices across the sector, as well as the need for open and effective competition in the deployment of FMs.
As part of this work, the CMA has been monitoring the impact of partnerships and strategic agreements which could result in a weakening of competition in the development or use of FMs.
The partnership between Microsoft and OpenAI - which includes a multi-year, multi-billion-dollar investment, collaboration in technology development and exclusive provision of cloud services by Microsoft to OpenAI - isa close, multi-faceted relationship between the two with significant activities in FMs and related markets.
As a result, the CMA is now issuing an ITC to determine whether the Microsoft / OpenAI partnership has resulted in an acquisition of control, meaning where one party has material influence, de facto control or more than 50% of the voting rights over another entity, or change in the nature of control by one entity over another.
