EU expands scrutiny of Microsoft’s $13b OpenAI investment

The European Union’s (EU) antitrust regulators are intensifying scrutiny of Microsoft’s $13 billion investment in OpenAI, focusing on the exclusive use of Microsoft’s Azure cloud services by the AI firm.

EU antitrust chief Margrethe Vestager announced Friday that while the deal falls outside the EU’s merger rules, regulators are querying Microsoft’s rivals about potential anti-competitive practises.

The EU is also investigating other tech partnerships, including Google’s arrangement with Samsung to pre-install its “Gemini nano” AI model on certain devices. Additionally, regulators are examining practises such as mass hiring by Big Tech firms to acquire startups.

Microsoft defended the partnership, stating the EU’s review has confirmed the investment does not grant control over OpenAI. However, EU officials have raised concerns about market dominance and possible barriers to competition.

This enquiry follows global scrutiny of Microsoft and OpenAI after the recent leadership upheaval at OpenAI, during which Microsoft CEO Satya Nadella supported Sam Altman’s reinstatement as OpenAI’s chief. Regulators in the US and UK are also probing whether the partnership shifts the balance of power in favour of Microsoft.

The EU’s findings could lead to formal investigations, behaviour changes, or fines of up to 10 per cent of annual revenue if anti-competitive practises are confirmed.

Attribution: Bloomberg

Subediting: Y.Yasser