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The UK’s competition watchdog has launched a formal merger inquiry into Amazon’s investment in the high-profile artificial intelligence start-up Anthropic, as regulators step up their scrutiny of deals in the fast-growing technology.
The Competition and Markets Authority said on Thursday that it had “sufficient information” about Amazon’s partnership with the company behind the Claude generative AI models to begin an investigation. It will decide whether to escalate the inquiry into a more in-depth “Phase 2” investigation by October 4.
The CMA could ultimately clear the deal, block it or require the companies to make changes in order to obtain approval.
Amazon said it was “disappointed” by the decision and that its work with Anthropic “does not raise any competition concerns or meet the CMA’s own threshold for review”.
“By investing in Anthropic, Amazon, along with other companies, is helping Anthropic expand choice and competition in this important technology,” it said.
Anthropic meanwhile said it will “cooperate with the CMA”, adding: “We are an independent company. Our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others.”
Thursday’s move comes weeks after the CMA officially launched a formal merger inquiry into rival Microsoft’s hiring of staff from start-up Inflection AI. The tech giant paid $650mn in March to hire a number of the start-up’s staff, including its chief executive Mustafa Suleyman, co-founder of Google’s DeepMind, and to license its technology.
Regulators worldwide have increasingly turned their attention to the alliances being forged between Big Tech and AI start-ups that are developing the technology that has captured global attention and which advocates promise will usher in a new era of computing.
The tie-ups have prompted concerns that the world’s largest and most well-capitalised companies are set to wield an outsized influence over how the hugely expensive technology will develop and who the winners from its adoption will be.
Amazon’s $4bn investment in Anthropic, which gave it a minority stake in the company and was completed in March, is among the prominent AI deals that the CMA said in April it was seeking views about as it took steps to probe what it called potentially anti-competitive behaviour.
The CMA said at the time that it was considering whether the partnership amounted to a merger and, if so, whether that posed competition risks. The watchdog must seek comments before launching a formal investigation.
The deadline for the watchdog to escalate its probe into Microsoft and Inflection to the next level is September 11.
A number of regulators globally are probing Microsoft’s $13bn partnership with the leading start-up OpenAI. The Seattle-based company said in July that it had given up its seat as an observer on the board of OpenAI. But it retains the exclusive right to provide the cloud computing services required by the start-up.
The CMA invited comments on the deal last year, but has not yet announced whether it will escalate its probe into a formal merger inquiry.
Amazon, by contrast, is not Anthropic’s exclusive cloud provider, nor has it ever held a seat on the start-up’s board. Google has also taken a multibillion-dollar stake in the start-up.
Earlier this year, the Federal Trade Commission, the CMA’s US counterpart, launched an inquiry into both Amazon and Google’s investments in Anthropic, as well as into Microsoft’s backing of OpenAI, the group behind ChatGPT.
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