- Wednesday, October 16, 2024
The CMA is seeking input from interested parties on whether the Microsoft-OpenAI partnership, following the departure and subsequent reinstatement of co-founder and CEO Sam Altman, can be considered a de facto merger that may affect competition.
This invitation is the first step in the CMA's information gathering process before any formal investigation is launched.
OpenAI recently appointed a new board and granted Microsoft an observer role, as Microsoft has invested approximately $13 billion in the company.
The CMA will assess whether the partnership between Microsoft and OpenAI has led to an acquisition of control, in which one party has substantial influence, de facto control, or voting rights exceeding 50% over the other entity.
Microsoft has pledged full cooperation with the CMA, stating that their collaboration with OpenAI has fostered greater innovation and competition, while maintaining independence for both companies. Vice Chair and President Brad Smith emphasized that Microsoft's non-voting observer status on OpenAI's board is distinct from an acquisition.
The CMA described the partnership between Microsoft and OpenAI as a comprehensive relationship, involving a substantial investment, technology development collaboration, and exclusive cloud services provision by Microsoft to OpenAI. The two firms have significant activities in foundation models and related markets.
At the time of writing, OpenAI has not provided a response to Dow Jones Newswires' request for comment.
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