Britain on Wednesday ended its investigation into Microsoft’s collaboration with OpenAI, the company that makes ChatGPT, claiming that the software behemoth lacked sufficient control over the AI startup to justify a follow-up.
TakeAway Points:
- Britain dropped its probe into Microsoft’s partnership with ChatGPT maker OpenAI on Wednesday, saying the software giant did not have the level of control over the AI company that would warrant further investigation.
- The CMA this year gained new powers, in addition to its merger controls, to investigate the biggest tech firms if it determines they have “strategic market status.”
- Alphabet’s Google released an experimental version of its search engine on Wednesday that completely ditches its typical 10 blue links in favor of an AI-generated summary.
Uk drops antitrust Probe
The partnership, which started in 2019 with an initial $1 billion investment by Microsoft, has come under antitrust scrutiny in Britain and the U.S.
A battle in the startup’s boardroom that led to the exit and return of CEO Sam Altman in 2023 raised questions about the company’s structure.
Britain’s Competition and Markets Authority (CMA) said although Microsoft did acquire material influence over OpenAI in 2019, it had not since gained de facto control, and therefore it did not qualify for review under the UK’s merger control regime.
However, it said the conclusion “does not constitute a finding that no competition concerns arise from its operation.”
A Microsoft spokesperson said the partnership with OpenAI and its continued evolution “promote competition, innovation, and responsible AI development”.
“We welcome the CMA’s conclusion, after careful and prudent consideration of the commercial realities, to close its investigation,” the spokesperson said.
The CMA has been looking into the ties between big tech companies and AI start-ups in recent years.
It has examined partnerships between Microsoft and Mistral AI, Amazon and Anthropic and Google-owner Alphabet and Anthropic, but none have met the threshold of control required to progress to a full investigation under its merger control remit.
The CMA this year gained new powers, in addition to its merger controls, to investigate the biggest tech firms if it determines they have “strategic market status.”
It has already launched investigations into Apple and Google’s smartphone ecosystems and Google’s search services.
However, the appointment in January of former Amazon executive Doug Gurr as the regulator’s interim chair signaled it could be prepared to go easier on deal-making in the future, analysts and lawyers have said.
Google tests an AI-only version of its search engine
Alphabet’s Google launched an experimental version of its search engine on Wednesday that completely eliminates its classic 10 blue links in favor of an AI-generated summary.
The new feature, available to subscribers of Google One AI Premium, can be accessed via the results page for any search query by clicking on a tab labeled “AI Mode” to the side of existing options like Images and Maps.
“We’ve heard from power users that they want AI responses for even more of their searches,” Robby Stein, a vice president of product, said in a blog post.
Google One AI Premium is a $19.99 per month plan that provides extra cloud storage and special access to some AI features.
Google currently displays AI Overviews, summaries that are increasingly appearing atop the traditional hyperlinks to relevant webpages, for users in more than 100 countries. It began adding advertisements to AI Overviews last May.
With AI Mode, users see a more comprehensive AI summary with hyperlinks to cited webpages. The 10 blue links have been replaced by a search bar for asking follow-up questions.
Google said AI Mode is being powered by a custom version of its Gemini 2.0 model with reasoning capabilities that make it better equipped to handle complex queries.
Alphabet’s $350 billion in 2024 revenue was primarily driven by search-related advertising. But it is facing the biggest challenge to its core business in years from AI challengers led by Microsoft-backed OpenAI, which added search functions to ChatGPT last October.
Google has made integrating AI into search its biggest bet, investment chief Ruth Porat said at the Reuters NEXT conference in December.
In February, edtech company Chegg sued Google, accusing the previews of eroding demand for original content and undermining publishers’ ability to compete.
