The U.K. Competition and Markets Authority (CMA) is starting an investigation into Alphabet’s (GOOGL) partnership with artificial intelligence (AI) startup Anthropic. The regulator is concerned that the deal could reduce competition in the UK market.
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Further, the CMA seeks to determine if this partnership is a “relevant merger situation” under the provisions of the Enterprise Act 2002, which could potentially impede competition.
Google-Anthropic Deal
Last year, Alphabet agreed to make a strategic investment of up to $2 billion in Anthropic, starting with a $500 million initial round.
Both companies have stated that the deal does not affect Anthropic’s independence. Further, they added that Google does not have a seat on Anthropic’s board.
Heightened Scrutiny
This development comes as the broader AI landscape is facing intense scrutiny. Interestingly, similar investigations have been made into Microsoft’s (MSFT) partnership with OpenAI and Amazon’s (AMZN) investment in Anthropic.
As the AI race heats up, regulators are increasingly concerned about the potential for market dominance by a few tech giants. The outcome of these probes could shape the future of the AI industry.
Is it a Good Time to Buy GOOGL Stock?
According to Wall Street analysts, it is a good time to buy GOOGL stock.
Alphabet has received 30 Buy and seven Hold recommendations for a Strong Buy consensus rating. The analysts’ average price target on Alphabet stock of $204.62 implies an upside potential of 20.16% from the current levels. Shares of the company have witnessed year-to-date growth of 22.1%.
