UK regulator investigates Amazon's $4 billion investment in Anthropic
What's the story
The United Kingdom's antitrust watchdog, the Competition and Markets Authority (CMA), has initiated a formal investigation into Amazon's $4 billion investment in Anthropic. The San Francisco-based artificial intelligence (AI) start-up is known for its development of large language models (LLMs) and an associated chatbot named Claude. The inquiry follows closely on the heels of a similar probe by the CMA into Google's relationship with Anthropic, after it invested around $2.3 billion in the start-up.
Tech profile
Anthropic's technology and funding
Anthropic, established in 2021, operates as a public benefit corporation (PBC) and has secured $10 billion in funding since its inception. The start-up's technology is comparable to that of OpenAI's ChatGPT or Google's Gemini. In addition to the Amazon probe, the CMA is also anticipated to conduct a thorough investigation into Microsoft's partnership with OpenAI, following substantial investments made by Microsoft in recent years.
Regulatory scrutiny
Preliminary inquiries into Big Tech deals
In April, the CMA disclosed that it was conducting preliminary inquiries into three similar deals involving Big Tech companies. One of these included Microsoft's investment in French startup Mistral AI, which was quickly deemed not to qualify for investigation under current merger regulations due to the size of the investment. However, the CMA did announce that it would extend its investigation into Microsoft's acqui-hire of the core team behind Inflection AI, an OpenAI rival that Microsoft had previously invested in.
Information
Phase 1 investigation into the deal
The CMA has decided to follow through with an official phase 1 investigation into this relationship. The regulator has 40 working days to determine whether Amazon's investment qualifies under merger regulations and if it could potentially harm competition in the UK.
Company stance
Anthropic asserts independence amid enquiries
In response to the investigation, Amazon has clarified that its investment does not give it a majority stake in Anthropic. A spokesperson for Anthropic reaffirmed the company's independence to TechCrunch, stating, "We are an independent company. Amazon does not have a seat on Anthropic's board, nor does it have any board observer rights." The spokesperson further added that the company intends to cooperate with the CMA and provide them with a comprehensive understanding of Amazon's investment and their commercial collaboration.