Irish Council for Civil Liberties says Microsoft–OpenAI partnership must be investigated as merger

Microsoft’s $13-billion investment in OpenAI has earned it a seat on the company’s board and the attention of European regulators.

The Irish Council for Civil Liberties wants Microsoft investigated by European Union regulators over its partnership with OpenAI.

In response to a call for commentary from the European Commission, the Irish civil liberties group posted its submission on Feb. 2. The letter begins by welcoming the investigation and continues to lay out a point-by-point case against treating the Microsoft–OpenAI relationship as anything other than a merger.

Earlier this week, @ICCLtweet along with a diverse group of organisations made a submission to European Commission on Microsoft-OpenAI “partnership” merger inquiry. The submission builds on our submission to the UK competition authority.https://t.co/2qoKKBVGIG

— Kris Shrishak (@KrisShrishak) February 2, 2024

Signs of a merger

The council’s submission was endorsed by several partner organizations, including Foxglove, Mozilla and the European Digital SME Alliance.

Text throughout the document indicates that the council views Microsoft’s involvement with OpenAI as going beyond the norm for such arrangements.

The commentary cites Microsoft’s $13-billion investments in OpenAI as well as the latter’s recent firing and then rehiring of its CEO and co-founder Sam Altman in its teardown of the current arrangement.

The council goes on to point out that Microsoft stepped in and asked OpenAI to reverse its decision to fire Altman before ultimately offering employment to Altman and any other OpenAI workers who wanted to jump ship with the former CEO.

Artificial intelligence influence

“Taken together,” writes the council, “the leadership struggle of November 2023 at OpenAI and other developments strongly suggest that Microsoft had or has acquired ‘decisive influence’ over OpenAI.”

Beyond merely influencing company decisions, the council also submits that Microsoft is exercising monopolistic power over the AI industry. The Redmond company’s Azure cloud services serve as infrastructure for some OpenAI services; the council is asking the EU commission to investigate whether Microsoft has ultimate technological control over ChatGPT and other services.

Per the submission, such control would be detrimental to the marketplace and consumers:

“Letting the largest incumbents dictate how AI develops, by leveraging their current monopoly power into future markets and technologies and ensuring control over companies which could have threatened their dominance, will serve their profit margins but will not serve the public interest.”

The Microsoft–OpenAI partnership is also being investigated in the United Kingdom where regulators will determine whether it should be considered a merger by law.

Related: Microsoft CEO calls OpenAI partnership ‘pro-competition’ amid UK, EU merger probes