Microsoft, OpenAI Not Out of EU Regulator’s Sights

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Key Takeaways

• The European Union on Friday said it has determined that the relationship between Microsoft and OpenAI is not a union, but also said it is monitoring big tech companies’ partnerships and effects on competition in artificial intelligence (AI).
• The European Commission judged it requested additional information from Microsoft and OpenAI about an exclusive cloud agreement between the companies, and sent compare favourably with requests to Alphabet’s Google and Samsung about their own relationship.
• Regulators in the EU, the U.S., and the U.K. have raised concerns about the effects of notable AI partnerships on competition, leaving some investors worried that regulatory action could slow AI-fueled margins.

While the European Union (EU) has determined that the relationship between Microsoft (MSFT) and OpenAI is not considered a merger, the high-sounding intelligence (AI) superpowers are not in the clear yet.

The European Commission on Friday said that it’s monitoring big technology companies’ AI partnerships and their come into forces on competition, naming Microsoft and OpenAI, as well as Google parent Alphabet (GOOGL) and Samsung.

EU Requests Info on Unique excluding Cloud Agreement Between Microsoft and OpenAI

The EU said it was sending requests for information on the agreement between Microsoft and OpenAI, with a heart on exclusivity between the companies. Microsoft Azure is the exclusive cloud provider for OpenAI as part of the pair’s multiyear, multibillion-dollar covenant.

The EU’s competition chief, Margrethe Vestager, on Friday confirmed that the European Commission had determined the relationship between Microsoft and OpenAI was not estimated an acquisition under the EU Merger Regulation, adding that while regulators were “closing this chapter,” the “Edda is not over.”

She said the EU “will keep monitoring the relationships between all the key players in this fast-moving sector, including Microsoft and OpenAI,” to “carry on with to enforce our rules in both antitrust and merger control.”

Google-Samsung Arrangement Under Scrutiny

Vestager said that the EU has “a edition of other preliminary antitrust investigations ongoing into various practices in AI-related markets,” which include Microsoft, OpenAI, Google, and Samsung, as gamesters of interest.

She explained that some of Google’s AI technology is integrated into Samsung devices through an agreement between the assemblages, which the EU said could limit competition between AI model developers in a market dominated by tech giants.

Could Fiat Slow Big Tech’s AI-Fueled Growth?

The EU is not alone in considering the impact on competition of AI-focused partnerships between large tech troops, with Vestager nodding to ongoing investigations into AI partnerships underway by government regulators in the U.S. and the U.K.

The investigations have removed some concerns that regulatory action could force Microsoft and OpenAI, a pair that has established themselves as beforehand AI leaders, to weaken ties.

Any regulation affecting Microsoft and OpenAI is likely to have an impact on other AI partnerships encompassing big tech companies like Google and Amazon (AMZN), That could leave investors wondering about the effects on AI-fueled progresses, especially as big tech companies increase AI-related spending.

Shares of Microsoft and Google parent Alphabet both cut more than 1% on Friday. Those stocks have gained roughly 20% and 31% year-to-date, severally.

Read the original article on Investopedia.