By 
The UK’s antitrust regulator, the Competition and Markets Authority (CMA), has launched an early-stage review into Google’s investment in the U.S. AI company Anthropic. This comes after Alphabet, Google’s parent company, invested significantly in Anthropic over multiple rounds.
Although the review is not yet a formal investigation, the CMA is seeking input from stakeholders and other interested parties to determine if Google’s involvement with Anthropic constitutes a “relevant merger situation” that could substantially reduce competition in the UK market.
Founded in San Francisco in 2021, Anthropic focuses on developing AI systems with an emphasis on safety, transparency, and risk management. The company, known for its large language models (LLMs) and chatbot Claude, positions itself as a public benefit corporation (PBC) distinct from competitors like OpenAI’s ChatGPT and Google’s Bard.
Since its inception, Anthropic has raised nearly $10 billion, with Google initially investing approximately $300 million early last year and following up with an additional $2 billion. Anthropic has also attracted major investments from other tech giants, including Amazon, which invested $4 billion.
This surge in investment has drawn regulatory attention, with concerns that big tech firms are adopting new merger and acquisition strategies to gain control over emerging innovators without undergoing the full scrutiny of a traditional acquisition. This approach, termed a “quasi-merger,” might involve strategic investments or hiring talent rather than outright acquisitions.
The CMA disclosed in April that it was investigating several such deals, including Microsoft’s recent investment in French startup Mistral AI. However, it concluded that Mistral AI did not warrant further investigation under current merger regulations due to the scale of the investment. The CMA is also reviewing Amazon’s relationship with Anthropic and is expected to launch a comprehensive probe into Microsoft’s partnership with OpenAI, the creator of ChatGPT.
Interested parties have until August 13, 2024, to provide feedback to the CMA. The decision on whether to advance to a formal “phase 1” investigation will likely depend on whether Google’s stake in Anthropic is deemed significant enough to grant it material control over the startup. If the investment is considered minor and non-influential, the CMA may decide against further investigation, similar to its approach with Microsoft’s investment in Mistral AI.
An Anthropic spokesperson stated, “We intend to cooperate with the CMA to provide a complete overview of Google’s investment and our commercial collaboration. Anthropic remains an independent entity, and our strategic partnerships and investor relationships do not compromise our corporate governance or our ability to engage with other partners. Independence is fundamental to our mission and our service to our customers.”
A Google spokesperson added that the company is “dedicated to fostering the most open and innovative AI ecosystem globally” and emphasized that it does not require Anthropic to use Google Cloud exclusively.
“Anthropic is free to use multiple cloud providers and does so; we do not impose exclusive technology rights,” the spokesperson said.
Comments