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Microsoft/OpenAI Relationship Could Face EU Probe

European regulators are reviewing whether Microsoft’s involvement with OpenAI warrants further investigation.

The European Commission (EC) revealed its interest in the ties between the companies Tuesday (Jan. 9) as it announced a larger artificial intelligence (AI) project.

“Virtual worlds and generative AI are rapidly developing,” Margrethe Vestager, the commission’s executive vice president in charge of competition policy, said in a news release. “It is fundamental that these new markets stay competitive, and that nothing stands in the way of businesses growing and providing the best and most innovative products to consumers.”

To that end, the EC is inviting businesses and experts to share competition issues that they’ve seen in these sectors, while also examining AI partnerships to make sure they “do not unduly distort market dynamics,” Vestager said.

Microsoft’s relationship with OpenAI — which involves a multibillon dollar investment on the part of Microsoft — became more apparent late last year following the dramatic firing and rehiring of OpenAI CEO Sam Altman.

The ties between the companies are also the subject of a possible probe by the United Kingdom’s Competition and Markets Authority (CMA).

The regulator said last month that it hopes to determine if “recent developments” have resulted in a merger situation and if a merger could affect competition in Great Britain.

The CMA has issued an Invitation to Comment (ITC) that offers Microsoft, OpenAI and interested third parties a chance to comment on these issues before the regulator decides whether to conduct a formal investigation.

These possible investigations are happening as efforts to regulate AI increasingly center around the question of whether AI models should be open-source or closed-source, as PYMNTS wrote Monday (Jan. 8)

“Open-source models are the AI systems in which — as the moniker suggests — the source code is shared openly, letting users voluntarily improve its function and design, and creating a permanent and accessible record of its design,” that report said.

As the debate unfolds, new partnerships emerge. 

A group of 50 companies and organizations — including NASA, CERN, Meta and IBM — forming the AI Alliance last month to support “open innovation and open science in AI.”

At the same time, tech giants such as OpenAI, Anthropic, Microsoft and Google have created their own industry group, the Frontier Model Forum, to “promote proprietary-centric legislation,” PYMNTS wrote.

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