Will Microsoft-OpenAI Partnership Face UK Antitrust Challenge? CMA Probes Potential Impact
Portfolio Pulse from Anusuya Lahiri
The UK's Competition and Markets Authority (CMA) is considering a merger probe into the partnership between Microsoft Corp (NASDAQ:MSFT) and OpenAI. The CMA is assessing potential competition issues in the UK following their collaboration. Microsoft, as the principal investor, has invested $13 billion in OpenAI. The partnership has integrated OpenAI's AI innovations into Microsoft's enterprise tools, while OpenAI uses Microsoft's cloud services. Despite the close ties, Microsoft does not control OpenAI, as evidenced by the recent reinstatement of OpenAI's CEO Sam Altman after his ousting. Microsoft's president, Brad Smith, asserts that the partnership fosters AI innovation and competition, with Microsoft being a nonvoting observer on OpenAI's board. MSFT shares are slightly down in premarket trading.

December 08, 2023 | 12:54 pm
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Microsoft's partnership with OpenAI is being scrutinized by the UK's CMA for potential antitrust issues. The company has invested $13 billion in OpenAI and has integrated its AI technology into its products, while maintaining that it does not control OpenAI.
The CMA's consideration of a merger probe into Microsoft's partnership with OpenAI could create uncertainty for investors, potentially affecting MSFT's stock price. However, the current impact is minimal as the shares are only slightly down in premarket trading. The situation could evolve if the CMA decides to take action, but for now, the effect is neutral.
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