Microsoft’s artificial intelligence (AI) partnership with Mistral has been cleared by the Competition and Markets Authority (CMA) in the United Kingdom. The CMA had received a request for advice on whether the arrangement constituted a merger. However, after reviewing the evidence presented by both Microsoft and Mistral, as well as industry comments, the CMA concluded that the acquisition did not qualify for investigation under the merger provisions of the Enterprise Act 2002.
The CMA determined that Microsoft does not have “material influence” over Mistral. This decision is seen as a positive development for new entrants in the AI economy, as partnerships and investment are crucial for their growth. Microsoft applauded the ruling, stating that their partnership and fractional investment in Mistral do not meet the criteria for a merger or acquisition.
Mistral, a French AI startup founded in 2023, received a 15 million euro (approximately 16 million dollars) investment from Microsoft earlier this year. In exchange, Mistral’s language models will be integrated into Microsoft’s Azure cloud computing platform. This collaboration aims to enhance the capabilities of Azure and strengthen Microsoft’s position in the AI market.
The CMA’s decision regarding Microsoft and Mistral is part of a broader investigation into partnerships between larger technology companies in the US and smaller AI companies. The CMA is examining whether these partnerships constitute mergers. It is also investigating other transactions, such as Amazon’s arrangement with Anthropic and Microsoft’s involvement in the OpenAI project.
While the CMA has cleared Microsoft’s investment in Mistral, it has not disclosed any new information regarding its investigations into other transactions. Microsoft has previously denied that its transactions involving OpenAI and Mistral, as well as the recruitment of staff from Inflection, constituted mergers. Amazon has also emphasized that its partnership with Anthropic is not a merger but a restricted corporate investment.
The CMA’s ongoing workstreams in the AI sector indicate that competition authorities are closely monitoring developments in this field. The CMA is expected to make further announcements in the future regarding the outcomes of its investigations.
In related news, OpenAI’s recent deal with Reddit has boosted the company’s shares, highlighting the growing significance of AI collaborations and investments in the market.
Overall, the CMA’s clearance of Microsoft’s partnership with Mistral provides regulatory assurance and paves the way for increased collaboration between larger tech companies and AI startups. This decision supports innovation and growth in the AI sector, while competition authorities continue to closely monitor developments to ensure fair competition and protect consumer interests.
