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Antitrust regulators looking at Microsoft/OpenAI relationship
RICHARD WEINER
Technology for Lawyers
Published: February 23, 2024
So this is even more complex than the Milwaukee Bucks coaching situation, if that’s possible.
To refresh: Several months’ ago the board of OpenAI, the developer of ChatGPT, fired its founder and president, Sam Altman.
Altman is the visionary of the company who put together the technical side with the money side.
On the money side were some pretty well-known actors with deep experience in technology and money, including Elon Musk and Microsoft.
Well, Elon was bounced out of the company, but Microsoft ponied up $10 billion in cash a few days/weeks before the public release of ChatGPT last year, after already investing $3 billion to get it up and going in 2019.
Then over the course of four days late last year, OpenAI fired Altman, then Microsoft hired Altman two days later, then most of the tech side threatened to leave OpenAI for Microsoft to continue to work with Altman, and then OpenAI brought Altman back and the staff stayed at the company and the board was restructured to include Microsoft as a voting member.
Sorta kinda looks like Microsoft, the world’s second largest company, has a lot of control over the much smaller OpenAI—or, at least, several regulators think that there might be something like that going on.
Enough control to violate antitrust laws?
Well, no agency has opened up a formal investigation, but the following agencies have announced pre-investigations:
FTC. The Federal Trade Commission, which has lost in court to Microsoft before, is taking a look but going slowly.
The UK’s Competition Markets Authority has opened an inquiry into the situation, asking for public feedback on whether the “close, multi-faceted relationship” between the two companies virtually amounts to a “relevant merger” and, if so, if that merger would violate UK antitrust laws.
And the EU isn’t leaving itself out, with its antitrust regulator stating that the EU Commission is following the situation “very closely.”
Sounds to me like nobody’s going to do anything. What do you think?