A PYMNTS Company

EU Antitrust Chief Concerned Over Microsoft’s Hiring Spree in AI Sector

 |  April 3, 2024

In a recent statement, Margrethe Vestager, the European Union’s antitrust chief, voiced concerns over Microsoft’s aggressive hiring strategy within the artificial intelligence (AI) sector. The tech giant recently made headlines for its acquisition of a significant portion of talent from AI startup Inflection, including its co-founders Mustafa Suleyman and Karen Simonyan.

Microsoft’s move, which involved absorbing most of Inflection’s 70-strong team into its newly established unit called Microsoft AI, has raised eyebrows among industry competitors. According to Reuters, the maneuver has sparked criticism from rivals who argue that Microsoft’s talent and technology acquisition allowed it to bypass the regulatory scrutiny typically associated with conventional mergers and acquisitions.

Vestager acknowledged the developments, emphasizing that while such actions do not fall under traditional merger regulations, they are closely monitored by regulatory authorities. “It is the kind of thing on which we keep an eye but as you say, since it is not a merger it is not caught by merger rules,” Vestager stated during a press briefing.

Related: Microsoft Aims For AI-Powered Version Of Bing

Despite not taking immediate action, Vestager hinted at the possibility of regulatory intervention if similar patterns emerge within the industry. “We might (look into it) but we have no decisions, neither to do something or not do something. We have registered that this is happening and also registering that it’s happening in a way so that it escapes our scrutiny from our usual boxes,” she explained to Reuters.

The concern extends beyond Microsoft’s actions alone, as Vestager expressed apprehension about the potential replication of this hiring strategy by other companies. “Of course if things become a trend and if that trend seems to be something that circumvents what has been put in place to preserve competition, which is merger rules, of course that could be restored and eventually corrected,” Vestager cautioned.

As the AI sector continues to evolve and attract top talent, regulatory bodies like the EU Commission remain vigilant in safeguarding competition and preventing anti-competitive practices.

Source: Reuters