UK launches antitrust investigation into Google, Anthropic

Last October, Google agreed to invest $2 billion in Anthropic, becoming its “preferred cloud services provider.”

Google parent Alphabet is under scrutiny in the U.K. over its links to artificial intelligence startup Anthropic, and is also facing scrutiny for violating the country’s competition laws.

Anthropic is the creator of Claude, a generative AI model that closely competes with OpenAI’s ChatGPT. It was founded by former OpenAI employees and siblings Daniela and Dario Amodei in 2021.

The San Francisco-based startup is backed by industry giants like Amazon, Google and Salesforce.

Last October, Google agreed to invest $2 billion in Anthropic, which included an initial $500 million cash injection and an additional $1.5 billion over time. Earlier this year, Google invested $300 million in the company, acquiring a 10% stake. As a result, Anthropic agreed to make Google Cloud its “preferred cloud service provider,” and the companies will “co-create AI computing systems.”

The UK’s Competition and Markets Authority (CMA) is currently investigating whether Alphabet’s partnership with Anthropic has created a “material merger situation” that could lead to a “significant lessening of competition” in the UK market.

In a statement published today (30 July), the CMA invited “any interested party” to submit comments on the partnership ahead of the launch of a formal investigation. It set a deadline for comments of 13 August.

Amazon also announced plans to invest up to $4 billion in Anthropic and said its cloud services business, Amazon Web Services, would be the startup’s primary cloud provider.

Earlier this year, Anthropic unveiled a trio of tools called Claude 3 Opus, Haiku, and Sonnet, saying the suite sets new industry standards for a wide range of cognitive tasks. The company also plans to open its first EU office in Dublin.

The competition investigation comes just two weeks after the CMA opened an inquiry into whether Microsoft’s employment of former Inflection AI employees and other agreements between the two parties were relevant to the merger.

Microsoft, which like Google is pouring billions into AI, has hired former Inflection and DeepMind scientist Jordan Hoffman to run a new AI hub in London. Other hires include Inflection co-founders Karén Simonyan and Mustafa Suleyman, the latter of whom has been hired by Microsoft to head up its entire AI business.

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