Microsoft’s (NASDAQ:MSFT) $13 billion investment in OpenAI is under additional scrutiny in the EU. According to a Bloomberg report, the EU’s antitrust regulators intend to question OpenAI’s rivals about the company’s exclusive use of Microsoft’s cloud technology.
Margrethe Vestager, the bloc’s antitrust chief, has ruled out a merger review and intends to focus instead on potential competition issues from exclusivity clauses. Earlier this year, the EU antitrust watchdog began a review of Microsoft’s investment in OpenAI under its merger control rules. However, it has now stated that it would not proceed with the review due to a lack of evidence that Microsoft controls OpenAI.
Details of the EU’s Scrutiny into MSFT and OpenAI
Instead, the commission is now considering an investigation into whether the partnership between the tech giant and OpenAI harms competition. The EU stated that it had sent certain questions to MSFT to understand if “certain exclusivity clauses” in the agreement between Microsoft and OpenAI could negatively affect competitors.
It is believed that this move by the EU’s antitrust regulator is a step toward a formal probe. Earlier, the EU questioned Microsoft and other tech companies about whether AI market concentration could be a potential barrier to entry for new companies entering the market.
Commenting on the EU’s review, Microsoft stated that it appreciated the review and noted that its investment in OpenAI doesn’t give it control over the company.
The tech giant’s investment in OpenAI first came under EU scrutiny after OpenAI’s board abruptly dismissed its CEO, Sam Altman, last year, only to rehire him a few days later.
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