UK Antitrust Watchdog Clears Google's $2 Billion Investment in Anthropic AI

Google's Anthropic AI Deal Cleared by UK Antitrust Agency

(Bloomberg) -- Google's partnership with AI firm Anthropic has avoided further scrutiny after the UK antitrust watchdog concluded it doesn't qualify for a full blown investigation under merger rules. Google hasn't gained "material influence" over Anthropic as a result of the deal, the Competition and Markets Authority said on Tuesday. The agency started looking at the partnership after Alphabet Inc.'s Google pledged to invest $2 billion into the startup last year. Prior to the financing, Google also signed a cloud agreement with Anthropic. The CMA has been at the forefront of attempts by global regulators to ensure Big Tech's bets into the AI industry don't distort the market or lead to a handful of all-powerful firms. The UK agency voiced its concerns about what it called an "interconnected web" of partnerships and investments in the AI ecosystem. While Amazon.com Inc's own $4 billion investment into Anthropic was cleared in September, Microsoft Corp.'s investment into its OpenAI is still under the CMA's scrutiny. The watchdog also cleared Microsoft's Mistral and Inflection deals after relatively quick investigations. Tuesday's decision will come as a relief to Mountain View, California-based Alphabet as multiple antitrust cases pile up in Europe and the US -- including one that threatens to force Google to sell off its Chrome browser. Google's investment into the US-based public benefit corporation, which specializes in artificial intelligence safety and research, included gaining non-voting shares and certain consultation rights on significant business issues. The CMA reviewed significant volume of internal documents of the two companies and concluded that Google did not have the ability to exercise material influence over Anthropic through the partnership, it said. "Anthropic is an independent company and our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others,," Anthropic's spokesperson said after the CMA announcement. Google didn't immediately respond to a request for comment. It previously said Anthropic is free to use multiple cloud providers and that it doesn't demand exclusive tech rights. (Updates with details of the decision and context throughout.)

Google's Anthropic AI Investment Cleared by UK Antitrust Agency

Google's partnership with AI firm Anthropic has avoided further scrutiny after the UK watchdog said it doesn't qualify for a full blown investigation under merger rules. Google has not gained "material influence" over Anthropic as a result of the deal, the Competition and Markets Authority said on Tuesday. The watchdog opened the probe earlier this year after Alphabet Inc.'s Google pledged to invest $2 billion into the startup last year.

Google's $2 Billion Anthropic Investment Gets U.K. Antitrust Clearance -- 2nd Update

U.K. antitrust officials said they wouldn't open an in-depth investigation into Google's investment in artificial-intelligence startup Anthropic, removing pressure from the tech giant to justify the partnership to regulators. The Competition and Markets Authority launched a merger inquiry in October to establish whether Google's investment in Anthropic and its partnership with the startup posed a threat to competition in the country. Officials have now concluded the partnership doesn't qualify for investigation under Britain's merger provisions. Alphabet-owned Google agreed to raise its investment in Anthropic to up to $2 billion late last year in a bid to gain an edge over rivals like Microsoft, OpenAI and Amazon.com in the AI race. The startup, which offers an AI assistant known as Claude, was founded by several ex-OpenAI employees. Deals between U.S. tech majors and AI startups have been increasingly under the microscope on both sides of the Atlantic since OpenAI's release of ChatGPT in late 2022 ushered in a spending bonanza. In the U.S., the Federal Trade Commission launched an inquiry into generative AI partnerships earlier this year. That probe includes Alphabet, Amazon, Anthropic, Microsoft and OpenAI. In the U.K., the CMA's executive director of mergers, Joel Bamford, said the agency had dropped the Google-Anthropic probe because Google hasn't acquired the ability to materially influence Anthropic's commercial policy, meaning the partnership doesn't meet the jurisdictional threshold for U.K. merger control. Google doesn't hold board seats or voting rights at Anthropic and has no veto rights over the startup's strategic commercial decisions. Google didn't respond to a request for comment. An Anthropic spokeswoman said the startup welcomed the CMA's decision. "As we've made clear, Anthropic is an independent company and our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others," she said. The ruling from the CMA mirrors a similar decision not to open a formal investigation into Anthropic's links with Amazon, which invested $4 billion in the startup. In that decision, officials said they closed the case as they essentially lacked jurisdiction. The CMA has cleared several partnerships between large tech companies and AI startups this year, including Microsoft's hiring of former employees from Inflection AI. However, the agency is still reviewing Microsoft's investment in OpenAI. News Corp, owner of Dow Jones Newswires and The Wall Street Journal, has a content-licensing partnership with OpenAI.

Google's $2 Billion Anthropic Investment Gets U.K. Antitrust Clearance -- Update

U.K. antitrust officials said they wouldn't open an in-depth investigation into Alphabet-owned Google's investment in artificial-intelligence startup Anthropic, removing pressure on the search-engine giant to justify the partnership to regulators. The Competition and Markets Authority launched a merger inquiry in October to establish whether Google's investment in Anthropic and its partnership with the startup posed a threat to competition in the country. Officials have now concluded the partnership doesn't qualify for investigation under Britain's merger provisions. Partnerships between U.S. tech giants and AI startups have been increasingly under the microscope on both sides of the Atlantic since OpenAI's release of ChatGPT in late 2022 ushered in a spending frenzy. Google agreed to raise its investment in Anthropic to up to $2 billion late last year, part of the company's efforts to gain an edge over rivals like Microsoft, OpenAI and Amazon.com in the AI race. British antitrust officials said they dropped the Google-Anthropic case because they don't believe Google gained material influence over Anthropic. Google and Anthropic didn't respond to requests for comment. The announcement from the CMA mirrors a similar decision not to open a formal investigation into Amazon's links with Anthropic. Amazon invested $4 billion in Anthropic, a startup founded by several ex-OpenAI employees that offers an AI assistant known as Claude. The CMA has cleared several partnerships between large tech companies and AI startups this year, including Microsoft's hiring of former employees from Inflection AI. While those decisions offer some breathing space to U.S. tech giants in the U.K., their ties to AI startups are still under scrutiny on the other side of the Atlantic after the Federal Trade Commission launched an inquiry into generative AI partnerships earlier this year. That probe includes Google-owner Alphabet, Amazon, Anthropic, Microsoft and OpenAI. The FTC issued orders to the five companies to provide information on their investments into AI startups. News Corp, owner of Dow Jones Newswires and The Wall Street Journal, has a content-licensing partnership with OpenAI.

UK competition regulator clears Alphabet's investment in Anthropic

The U.K.'s Competition and Markets Authority (CMA) has okayed Alphabet's partnership and investment in AI rival Anthropic, concluding that it doesn't qualify for investigation under current merger regulations. The announcement comes a month after the CMA revealed it was launching a formal "stage 1" probe into Google's parent's various investments in Anthropic, a three-year-old San Francisco-based startup that develops large language models (LLMs) and an associated chatbot called Claude, which is something akin to OpenAI's ChatGPT or Google's own Bard. Alphabet had reportedly invested $300 million in Anthropic early last year, followed by another $2 billion. Anthropic had courted other big names from the tech world, including Amazon which had invested $4 billion. The CMA had been looking into that partnership too, however in September it came to the same conclusion as it has now with Alphabet, announcing that it couldn't investigate the deal under current merger rules due to the size and scope of the deal. These various investigations have formed part of a a multi-pronged probe into what has been dubbed the "quasi-merger," which has seen Big Tech firms take a fresh approach to gaining control of younger innovators through hiring startup founders and talent, and -- as it the case here -- making strategic investments. However, the CMA has now said that it "does not believe that Google has acquired material influence over Anthropic as a result of the partnership." More specifically, the CMA said that it considered whether the duo's commercial relationship meant that Google could exert influence at the board level, and also whether a technical reliance on Google's infrastructure (e.g. cloud computing resources) could also play a role in stymying competition. "The available evidence did not indicate that Google has the ability to exercise material influence over Anthropic through the partnership," the CMA noted.

The UK approves Google's $2 billion investment in Anthropic

The UK's competition regulator has cleared Google's $2 billion investment in Anthropic, and others. The Competition and Markets Authority (CMA) has officially concluded that the company hasn't acquired "material influence" over the AI startup Anthropic as a result of the investment. The continuing investigation into the partnership has also been squashed, with the UK antitrust watchdog saying that the investment doesn't qualify for a full probe under merger rules. This is after phase one of a . "Anthropic is an independent company and our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others," a company spokesperson said after the CMA announced its findings. Google's investment into Anthropic gives the company non-voting shares and consultation rights on significant business issues. Anthropic is best known for , which is in direct competition with . Earlier this year, the CMA the "interconnected web" of partnerships and investments in the rapidly advancing world of AI. The CMA also allowed a similar investment to go through in which . It didn't , on the grounds that Anthropic's UK turnover didn't exceed £70 million and the two parties didn't combine to account for 25 percent or more of the region's supply of AI LLMs and chatbots.

Google-Anthropic Partnership Gets UK Antitrust Regulator Approval | PYMNTS.com

The UK's competition watchdog has cleared Google's partnership with Anthropic. The Competition and Markets Authority (CMA) said Tuesday (Nov. 19) that it had determined that the deal between the tech giant and the artificial intelligence (AI) startup did not warrant additional investigation. "The CMA does not believe that Google has acquired material influence over Anthropic as a result of the partnership," the regulator said in its assessment of the arrangement, which came after a review of "a significant volume" of company documents. As reported here, the CMA announced the launch of the investigation last month. It stems from Google's financial backing of Anthropic, which includes a $500 million investment last year and an additional commitment of $1.5 billion. Google had said that Anthropic is free to use multiple cloud providers for its work, and that the company does not demand exclusive tech rights. In a related case, the CMA announced in September that it would not pursue its investigation into whether Amazon's partnership with Anthropic could harm competition, after determining that the arrangement did not meet the "turnover" or share of supply test for merger situations. "In particular, the CMA found that Anthropic's U.K. turnover does not exceed 70 million pounds in the U.K., nor do the parties, on the basis of the available evidence, together account for a 25% or more share of supply of any description of goods or services in the U.K.," the authority said. "The CMA does not therefore believe that it is or may be the case that a relevant merger situation has been created." Meanwhile, PYMNTS wrote earlier this month about Anthropic's latest AI model, which costs four times more than before but outperforms its earlier top model. The Claude 3.5 Haiku charges $1 to process a million tokens of input and $5 to generate a million tokens of output. Experts say the rising costs of high-performance AI models can present significant challenges for small- to medium-sized businesses (SMBs). "Developing custom AI solutions can be expensive, with costs ranging from $20,000 to over $500,000, depending on complexity," Niv Hertz, director of AI at Aporia, told PYMNTS. "This financial barrier may limit SMBs' ability to adopt advanced AI technologies, potentially widening the competitive gap between them and larger enterprises."

UK markets watchdog clears Alphabet and Anthropic partnership

The CMA investigation also found that Anthropic's UK turnover does not exceed £70m. The UK markets watchdog concluded that the planned merger between Google-owner Alphabet and Anthropic, the start-up behind the AI chatbot Claude did not qualify for an investigation. The Competition and Markets Authority (CMA) in its decision announced today (19 November) said that Google, through the merger deal, did not have "material influence" over Anthropic, which, the CMA concluded after a review of internal documents from the two parties. The watchdog investigated ways through which Google can exercise control over Anthropic, and although it found that Google can exercise influence on Anthropic at a board level, by being an important source of compute and through funding, it concluded that the "available evidence" did not indicate that Google has the "ability" to do so. Moreover, to qualify for a merger investigation, the business being taken over needs to either have an annual turnover in the UK of at least £70m or the combined businesses need to have at least a 25pc share in any market in the country. However, through inquiry, the CMA found that Anthropic's UK turnover does not exceed the minimum requirement of £70m. "Our investigation has shown that Google has not acquired the ability to materially influence Anthropic's commercial policy and therefore the partnership does not meet the jurisdictional threshold for UK merger control to apply," said Joel Bamford, the executive director of the CMA. "It's through merger reviews that we can appropriately assess the nature and impact of complex partnerships such as the one between Google and Anthropic," he said. Google agreed to invest $2bn in Anthropic last October, which included a $500m initial cash infusion and an additional $1.5bn over time. Through the merger, Google would acquire non-voting shares in Anthropic as well as enjoy a non-exclusive arrangement for the supply of compute capacity to Anthropic. While Anthropic, through a non-exclusive agreement would distribute its Claude foundation models on Vertex AI - a Google-owned machine learning platform to train and deploy AI and ML models. Moreover, Google will also take a consulting role, advising Anthropic on significant business issues. The partnership piqued the CMA's interest earlier this year, who launched the merger inquiry in October. However, Josh Mesout, chief innovation officer of Civo, a cloud service provider said; "While the CMA has decided not to pursue an investigation into the Anthropic-Alphabet partnership, the broader concerns raised in the investigation about potential market concentration in AI remain valid. "Over-dependence on a handful of major firms could still stifle innovation, limit consumer choice, and potentially lead to a monopoly that favours Big Tech." Earlier this year, the CMA closed two investigations into the Google and Apple app stores, assessing their potential impact on competition in the UK. However, as a provisional conclusion to another investigation, the markets watchdog found Google's actions as a dominant player in adtech may be harming advertisers and publishers and may have broken competition law. Don't miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic's digest of need-to-know sci-tech news.

Alphabet's AI partnership with Anthropic no longer under UK scrutiny

(Reuters) - Britain's competition watchdog said on Tuesday the partnership between Google-parent Alphabet and artificial intelligence startup Anthropic did not qualify for investigation under the merger provisions. The Competition and Markets Authority had been scrutinising Alphabet's relationship with Anthropic since July, when it began seeking views on whether the deal could undermine competition in the UK. (Reporting by Yadarisa Shabong in Bengaluru; Editing by Anil D'Silva)