The Competition and Markets Authority (CMA), UK’s competition regulator, has initiated an investigation into Amazon’s investment of over £3bn in an artificial intelligence (AI) startup. This move comes as regulators are increasing their scrutiny of mergers involving the rapidly growing technology.
In March, Amazon announced a $4bn (£3.16bn) investment in Anthropic, an AI startup known for its Claude generative AI models. As part of the deal, Anthropic committed to using Amazon Web Services as its “primary cloud provider” for crucial functions such as safety research and development of future foundation models.
According to a statement on the CMA’s website, the watchdog has “sufficient information” to begin an investigation into Amazon’s partnership with Anthropic. The CMA is considering whether this partnership has resulted in the creation of a relevant merger situation and if it has led to a “substantial lessening of competition” in any market or markets in the United Kingdom for goods or services.
This inquiry follows a decline in share prices for tech giants and companies associated with the AI boom. Amazon’s share price has also been affected, partly due to concerns raised by investors regarding the company’s heavy investment in AI without significant returns.
Last week, the CMA announced a similar investigation into Google’s partnership with Anthropic. The regulatory body is also looking into Microsoft’s involvement in Inflection, an AI lab, and OpenAI, the company behind ChatGPT.
The preliminary investigation into Amazon’s investment in Anthropic is currently underway, and the CMA will make a decision on whether to escalate the inquiry for an in-depth review by 4 October.
In response to the CMA’s probe, a spokesperson for Amazon stated that they are disappointed with the regulator’s decision to continue the investigation. They also clarified that Amazon’s collaboration with Anthropic does not raise any competition concerns and does not meet the CMA’s threshold for review.
The spokesperson further explained that Amazon does not hold a board seat or have decision-making power at Anthropic. They added that building AI models is a costly process and companies like Anthropic require substantial capital to train these models. By investing in Anthropic, Amazon is contributing to the expansion of choice and competition in this crucial technology.
When approached for comment, Anthropic did not respond immediately. The CMA’s investigation into Amazon’s investment in Anthropic is ongoing, and further updates will be provided as the inquiry progresses.
