UK Probes Microsoft’s Hiring of Ex-Inflection AI Staff

On Tuesday, Britain’s competition authority announced a formal probe into Microsoft’s hiring of former Inflection AI employees and its relationship with the business

In the past 18 months, regulators worldwide have heightened their attention to the A.I. industry’s potential anti-competitive behavior, with Microsoft’s numerous agreements with smaller startups coming under increasing scrutiny.

The tech giant appointed Mustafa Suleyman, the co-founder of Google DeepMind, as the director of its newly established A.I. unit in March. Additionally, it employed numerous personnel from Inflection, which he established in 2022.

According to Reuters, Microsoft had consented to pay Inflection approximately $650 million as part of the agreement. As a result, the startup was able to access Inflection’s A.I. models and reimburse its investors, which include former Google CEO Eric Schmidt and Bill Gates.

In response to the U.K. Competition and Markets Authority’s (CMA) investigation, a Microsoft spokesperson stated in an emailed statement to Reuters:

Competition and Markets Authority with the necessary information to expedite the completion of its inquiries.

The CMA must determine whether it will refer the agreement for a more comprehensive investigation by September 11.
Microsoft was already scrutinized for its partnerships with prominent A.I. ventures, including OpenAI and Mistral AI of France.

To assuage the concerns of U.S. and British antitrust regulators regarding the extent of its control over the A.I. startup, it relinquished its board observer membership at OpenAI last week.

The CMA has also solicited input regarding partnerships between Anthropic and Amazon (AMZN.O).