The CMA is conducting several probes into Microsoft and Amazon over their investments in AI startups.

 Uncompetitive investments

Both Amazon and Microsoft have been subject to CMA investigations relating to their dominance of the cloud market in 2022, with Microsoft also being accused of having unfair licensing terms and anticompetitive practices in the European cloud market.

The UK’s Competition and Markets Authority (CMA), which is responsible for maintaining fair competition in UK markets, has launched an additional three investigations into the tech giants.

Microsoft’s dealings with startups Mistral AI and Inflection AI, alongside Amazon’s dealings with Anthropic are now open to comments on whether they “fall within UK merger rules and the impact that these arrangements could have on competition in the UK,” the CMA says.

The CMA further warned earlier this month that cloud giants are selectively investing in startups and restricting access for other companies to use compute and data to develop foundation models.

Now, however, Microsoft’s funnelling of £12.9m into Mistral AI, some dealings with Inflection AI and the hiring of Inflection AI ex-employees, and Amazon’s £3.2bn Anthropic investments are being investigated to assess, “whether each of these three deals fall within UK merger rules and, if they do, whether they have any impact on competition in the UK,” Joel Bamford, executive director of mergers at the CMA said.

Bamford went on to say that foundation models could “fundamentally impact” many critical sectors of UK industry such as energy, transport, finance and healthcare.

“So open, fair, and effective competition in Foundation Model markets is critical to making sure the full benefits of this transformation are realised by people and businesses in the UK, as well as our wider economy where technology has a huge role to play in growth and productivity,” Bamford concluded.

Several investigations have been launched into partnership deals made by Microsoft and Amazon with AI startups, and how this might affect future work between them

Via CityAM

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