British regulators have initiated a preliminary inquiry into Microsoft’s recruitment of key personnel from an AI startup, citing concerns about potential anti-competitive practices in the rapidly growing artificial intelligence sector. The Competition and Markets Authority confirmed that its investigation into Microsoft’s hiring of individuals from Inflection AI, including CEO Mustafa Suleyman, has uncovered enough evidence to warrant further examination.
Microsoft appointed Suleyman to lead its consumer artificial intelligence division earlier this year, and also recruited several top engineers and researchers from Inflection AI. Suleyman, known for co-founding the AI research lab DeepMind (now owned by Google) before establishing Inflection, is a respected figure in the AI field.
The regulatory body is evaluating whether these hirings constitute a merger that could significantly reduce competition within the AI market in the U.K., potentially violating antitrust laws. Microsoft responded by asserting that talent acquisition is pro-competitive and should not be construed as a merger, pledging cooperation with the Competition and Markets Authority’s inquiries.
The Competition and Markets Authority must reach a decision by September 11 on whether to approve the initial findings or advance the investigation to a more comprehensive level. The authority holds the authority to annul agreements or impose remedies to address competition concerns.
Concerns about large tech companies absorbing the resources and expertise of smaller AI startups without formal acquisitions have escalated on both sides of the Atlantic. Recently, three U.S. Senators urged antitrust regulators at the Justice Department and the Federal Trade Commission to scrutinize Amazon’s acquisition of San Francisco-based Adept, highlighting that the deal involves Adept’s CEO and key staff joining Amazon, granting the e-commerce giant access to Adept’s AI technologies and datasets.
