Hu Yun Qi
BRUSSELS (Reuters) – Microsoft's partnership with OpenAI could be the subject of a European Union antitrust investigation after regulators singled out the companies' antitrust clauses and also came under scrutiny of Google's artificial intelligence (AI) contract with Samsung.
Margrethe Vestager, the EU's top competition official, said on Friday that EU antitrust regulators would seek further opinions from third parties.
The moves underscore regulators around the world's fears that big tech companies will leverage their advantages in new technologies and echo their market power in other areas.
In March, Vestager sent a survey to major tech companies, including Microsoft, Google, Meta's Facebook and ByteDance's TikTok, about AI partnerships.
“We are reviewing the response and are currently requesting additional information about Microsoft's OpenAI agreement to understand whether certain exclusivity clauses may have an adverse effect on competitors,” she said at the conference.
Reuters first reported that EU regulators were preparing a case that could lead to an investigation into the companies' partnership.
A Microsoft spokesman said: “We stand ready to respond to any further questions the European Commission may have.”
Vestager said the Microsoft-OpenAI partnership is not subject to EU merger rules because it lacks administrative powers.
OpenAI's parent company is a non-profit, but Microsoft has invested $13 billion in the for-profit subsidiary for a 49% stake.
Vestager also raised concerns that big tech companies are blocking smaller AI developers from reaching users and businesses.
“We are also requesting information to better understand the impact of an arrangement between Google and Samsung to pre-install Google's smaller Gemini Nano phone on certain Samsung devices,” she said.
In January, Google signed a multiyear deal with the South Korean company to incorporate its generative artificial intelligence technology into Samsung's Galaxy S24 series of smartphones.
Vestager said the company is also looking into “hiring by acquisition,” in which companies buy other companies primarily for talent — a case in point was Microsoft's purchase of startup Inflection Inc. for $650 million in March, when it was able to use Inflection's model to hire most of its staff.
“If these practices essentially lead to concentration, we will not allow them to get around our merger control rules,” she said.
(Reporting by Foo Yun Qi; Editing by Philip Blenkinsop and Rod Nickel)
