EU Antitrust Scrutiny on AI Deals Involving Microsoft, OpenAI, Google, and Samsung

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The partnership between Microsoft and OpenAI is under the lens of EU antitrust regulators due to concerns about exclusivity clauses. Similarly, Google’s AI deal with Samsung has also attracted regulatory attention. EU competition chief Margrethe Vestager announced that further third-party opinions would be sought to assess these agreements.

These actions reflect a growing global apprehension about Big Tech extending its influence into new technologies. In March, Vestager sent inquiries to several major tech firms, including Microsoft, Google, Meta’s Facebook, and ByteDance’s TikTok, regarding their AI partnerships.

Vestager stated, “We have reviewed the replies, and are now sending a follow-up request for information on the agreement between Microsoft and OpenAI to understand whether certain exclusivity clauses could have a negative effect on competitors.”

A Microsoft spokesperson responded, saying, “We stand ready to respond to any additional questions the European Commission may have.”

Vestager clarified that Microsoft’s partnership with OpenAI does not fall under EU merger rules due to the lack of control. Although OpenAI’s parent organization is a nonprofit, Microsoft has invested $13 billion in a for-profit subsidiary, potentially securing a 49% stake.

Concerns were also raised about Big Tech hindering smaller AI developers’ access to users and businesses. Vestager announced additional inquiries to better understand Google’s agreement with Samsung to pre-install its AI model Gemini Nano on certain devices.

In January, Google signed a multi-year deal to integrate its generative AI technology into Samsung’s Galaxy S24 series smartphones.

Vestager is also examining “acqui-hires,” where companies acquire others primarily for their talent, such as Microsoft’s $650-million acquisition of Inflection in March. This deal allowed Microsoft to utilize Inflection’s models and hire most of its staff.

“We will make sure these practices don’t slip through our merger control rules if they basically lead to a concentration,” Vestager emphasized.