The UK antitrust regulator has confirmed that it is conducting a formal antitrust investigation into Amazon's relationship with Anthropic, following the company's recent completion of a $4 billion investment in the AI startup.
The news comes a week after the Competition and Markets Authority (CMA) revealed it would open a call for comments on Google's relationship with Anthropic, following the internet company's initial investment of $300 million last year and then a further $2 billion since.
Founded in 2021, San Francisco-based Anthropic has established itself as a public benefit corporation (PBC) to differentiate itself from competitors and is developing large-scale language models (LLMs) and an associated chatbot called Claude, similar to OpenAI's ChatGPT and Google's Bard. The company has raised a massive $10 billion in funding in its three-year history.
The AI gold rush has prompted big tech companies to pursue a multi-pronged approach to stay afloat. There are growing concerns that big tech companies are adopting a new “quasi-merger” approach to M&A, seeking control over younger innovators through strategic investments and hiring startup founders and technical talent — any means necessary to avoid the regulatory scrutiny that comes with a full-scale acquisition.
The CMA is expected to launch a full-scale investigation into the close partnership between Microsoft and OpenAI, which has invested heavily in ChatGPT's developer, OpenAI, in recent years.
The regulator also revealed in April that it was conducting initial investigations into three similar transactions involving big tech companies, including Microsoft's investment in French startup Mistral AI, but the CMA quickly concluded that this was not subject to investigation under current merger control due to the size of the investment. However, the CMA said at the time that it was looking into Microsoft's acquisition and recruitment of the core team of Inflexion AI, a rival to OpenAI in which it had previously invested. Last month, the CMA announced it was expanding this into a full “phase 1” investigation.
The third element of the early stage investigation relates to Amazon and Anthropic, with the CMA concluding that it will proceed with a formal phase one investigation, meaning it has 40 working days to decide whether the investment – which Amazon has previously said it will not acquire a majority stake in Anthropic – falls under merger control and, if so, whether it could have an adverse effect on competition in the UK.
A spokesman for Antropic said the company's “strategic partnerships and investor relationships” would not compromise its ability to collaborate with other companies or its independent corporate governance.
“We are an independent company,” a spokesperson said in a statement to TechCrunch. “Amazon does not have a seat on Anthropic's board, nor does it have observer rights on the board. We intend to work with the CMA to provide a comprehensive understanding of Amazon's investment and our commercial collaboration.”
The CMA has until early October to decide whether to approve the deal or proceed with a more thorough investigation.
