From The Verge: UK regulators are now formally investigating Microsoft’s hiring of Inflection AI staff, months after most of Inflection’s staff joined Microsoft’s new AI division. The UK’s Competition and Markets Authority (CMA) is now opening up a phase one merger investigation into the partnership, with a September 11th deadline over whether the investigation will progress into a second phase.
If the case progresses to the phase two stage, then it could present a stumbling block for Microsoft’s AI ambitions. The CMA last signaled a more in-depth review of Microsoft’s $68.7 billion acquisition of Activision Blizzard in 2022, eventually forcing the company to restructure its deal and give up key cloud gaming rights in the UK and many other markets worldwide. It’s still early days for the CMA’s Inflection AI investigation, but the results could have an impact far beyond just the UK.
Microsoft hired Google DeepMind cofounder Mustafa Suleyman as part of the Inflection AI staff hirings. Suleyman left Google in 2022 to cofound Inflection AI, and he’s now CEO of Microsoft AI.
Regulators in the UK and EU have been increasingly looking at the AI partnerships and investments that Big Tech are making. The CMA also signaled interest in Microsoft’s Mistral AI partnership but decided that it didn’t qualify for investigation under its merger rules.
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