Microsoft is currently facing a pair of new antitrust probes from the Federal Trade Commission, which are centered around the company’s hiring of AI pioneer Mustafa Suleyman and colleagues from Inflection AI earlier this year. The FTC is investigating whether Microsoft structured a deal to gain control of Inflection without going through a review process with the FTC. Microsoft reportedly paid around $650 million to Inflection in a licensing deal, but the company is still operating as an independent entity known for its large language model and AI chatbot Pi. Suleyman, who co-founded DeepMind and was a former Google vice president of artificial intelligence, is now leading a new organization called Microsoft AI.
In addition to the investigation into Microsoft and Inflection, the Justice Department and FTC have also inked a new deal to pursue an antitrust investigation into the dominant roles that Microsoft, OpenAI, and NVIDIA play in the AI industry. The FTC will take the lead on investigating both OpenAI and Microsoft, who are close partners with Microsoft having invested over $13 billion into OpenAI. OpenAI, which provides technology that powers AI features in many Microsoft products, runs its services on Microsoft’s Azure cloud platform. This investigation stems from a previous inquiry launched by the FTC in January into Microsoft’s investment in OpenAI, as well as Amazon’s investment in Anthropic, another AI startup.
If the FTC finds that Microsoft should have reported and sought government review of the Inflection acquisition, the deal could be suspended. Microsoft has yet to comment on the ongoing investigations. The company’s headquarters campus in Redmond is undergoing renovations, as seen in a photo posted by GeekWire. Microsoft’s deal with Inflection and its partnerships with AI companies like OpenAI have raised concerns about potential antitrust violations in the industry. The FTC’s investigations into these companies and their activities aim to ensure fair competition in the AI market and prevent any anti-competitive behavior that could harm consumers.
The antitrust probes into Microsoft, OpenAI, and NVIDIA represent the government’s increased scrutiny of Big Tech companies and their activities in the AI industry. The investigations are focused on addressing concerns about the dominance of these companies in the market and their impact on competition and innovation. Microsoft’s investments in AI startups and partnerships with companies like OpenAI have drawn attention from regulators, raising questions about the potential consolidation of power in the industry. The outcomes of these investigations could have significant implications for the future of the AI market and the competitive landscape of the tech industry.
It remains to be seen how Microsoft will respond to the FTC’s inquiries and the potential consequences of the investigations on its business and partnerships. The company’s acquisition of Inflection and its close ties with OpenAI are key areas of focus for the antitrust probes. As the investigations progress, Microsoft will need to navigate the regulatory landscape and address any concerns raised by the FTC and other government agencies. The outcome of these investigations could have far-reaching implications for Microsoft, OpenAI, NVIDIA, and the broader AI industry, shaping the future of competition and innovation in the rapidly evolving tech sector. It is essential for companies like Microsoft to comply with antitrust laws and regulations to ensure fair competition and a level playing field for all participants in the AI market.
