EU competition watchdogs examine Microsoft and OpenAI - partnership or takeover?

EU competition watchdogs examine Microsoft and OpenAI - partnership or takeover?

According to a report by www.heise.de EU competition watchdogs are currently examining whether the partnership between Microsoft and OpenAI represents an investment or a form of takeover. This is about billions invested by Microsoft in OpenAI, which could potentially be subject to the EU Merger Regulation. Germany and the UK have also begun to explore the nature of this partnership. Germany has tentatively decided that the investments and partnership are not subject to merger control, but is keeping an eye on it in case Microsoft expands its influence over OpenAI. The UK antitrust watchdog is also examining whether the partnership resulted in “significant influence, de facto control or more than 50 percent of the voting rights over another organization and effects on control by one of the companies.”

Microsoft had invested around $10 billion in OpenAI, which has led to discussions about whether Microsoft exercises its influence over OpenAI, although it says it does not own shares in OpenAI and has no voting position on the board. The investments are mainly made available in the form of computing power. In a dispute within OpenAI, Microsoft offered employees, including the CEO, jobs within the company, raising questions about their independence and autonomy. The German competition authorities recognize artificial intelligence as a key technology and are closely monitoring whether the power of the large Internet companies is further consolidated through partnerships like this one.

This collaboration between Microsoft and OpenAI shows how investments by large corporations in emerging technology companies can impact the competition and autonomy of the target companies. It also raises questions about merger control in relation to such partnerships, particularly with regard to the influence and autonomy of the target acquisition. This research could show how regulators respond to international partnerships in the technology industry and what impact they can have on the market and competition.