Microsoft's Competition Problem

Ludo Lugnani
Ludo Lugnani

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  • 🔍 Competition: Microsoft-OpenAI faces CMA investigation
  • 🏠 Property: What does inflation mean for developers?
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  • 🚚 Trade: EU may reopen WTO case against Trump tariffs

Microsoft's Competition Problem

In Short: The UK's Competition and Markets Authority (CMA) is getting nosy about Microsoft's mega-money deal with OpenAI.

What is Going on?
Microsoft has buddied up with OpenAI i.e. the company behind ChatGPT. They've been throwing around billions in investments like confetti at a wedding. But then, the plot thickens: OpenAI's CEO, Sam Altman, gets the boot, only to be asked back to the party a few days later. Microsoft, playing the role of peacemaker, grabs a non-voting seat at OpenAI's table.

Now, the CMA, acting like that one friend who questions all your life choices, is poking around. They're basically asking everyone (including their competitors) whether this deal smells fishy. And, by the way, Microsoft is no stranger to CMA's magnifying glass, thanks to its hefty $75 billion splurge on Activision Blizzard.

Why does it matter?
Microsoft's investment in OpenAI is like pouring rocket fuel on the AI fire. They're embedding AI into everything – from your boring office software to the Bing search engine you only use by accident. It's like a Silicon Valley race to see who can slap AI onto more stuff.

But wait, there's more: Microsoft's deal originally gave them exclusive dibs on using OpenAI's tech for business clients. In return, OpenAI got to play with Microsoft's cloud computing tools, vital for creating top AI models.

And here’s the juicy part: OpenAI, which started as a non-profit, now has a capped profit arm with Microsoft as a minority owner.

⚖️ How does this impact Law Firms?

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