The UK’s competition regulator has given the green light to Microsoft’s recruitment of former Inflection AI employees and its partnership with the startup, stating on Wednesday that the deal does not warrant further investigation.
The Competition and Markets Authority (CMA) launched an inquiry in July to determine if the agreement could pose any competition risks within the UK, as both companies are involved in the development and provision of consumer chatbots.
The CMA concluded that, prior to the acquisition, Inflection AI held a small share of UK traffic for chatbots and AI tools. Furthermore, the company, unlike its competitors, lacked the potential to significantly expand or sustain its user base.
Earlier this year, in March, Microsoft appointed Mustafa Suleyman, co-founder of Google DeepMind, as the head of its newly established AI division. Additionally, the tech giant brought on board several employees from Inflection AI, a company Suleyman founded in 2022.
According to reports, Microsoft agreed to a payment of approximately $650 million as part of the partnership, which provided access to Inflection’s AI models and allowed the startup to repay its investors, including notable figures such as Bill Gates and former Google CEO Eric Schmidt.