UK Competition Watchdog Launches Formal Probe into Amazon’s $4bn Anthropic Investment
The UK’s Competition and Markets Authority (CMA) has initiated a formal investigation into Amazon’s $4 billion investment in artificial intelligence startup Anthropic. This move marks the latest in a series of probes by the regulator into partnerships between Big Tech companies and AI firms.
The CMA announced on August 8, 2024, that it had “sufficient information” to begin a Phase 1 investigation into the Amazon-Anthropic partnership. The regulator will have until October 4 to decide whether to escalate the inquiry to a more in-depth Phase 2 investigation or clear it of competition concerns.
Amazon completed its investment in Anthropic in March 2024, with an initial $1.25 billion equity stake in September 2023, followed by an additional $2.75 billion. As part of the deal, Anthropic agreed to use Amazon Web Services as its primary cloud provider for critical workloads, including safety research and future foundation model development.
The CMA’s investigation aims to determine whether the partnership constitutes a “relevant merger situation” that could potentially harm competition in the UK market. This scrutiny comes amid growing concerns that Big Tech companies may be adopting a “quasi-merger” approach to gain control over innovative AI startups without triggering full-scale regulatory reviews typically associated with outright acquisitions.
Both Amazon and Anthropic have expressed disappointment with the CMA’s decision to proceed with the investigation. An Amazon spokesperson stated that the collaboration “does not raise any competition concerns or meet the CMA’s own threshold for review.” The company argued that its investment is helping Anthropic expand choice and competition in the important field of generative AI.
Anthropic emphasized its independence, stating that “strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others.” The AI firm confirmed that Amazon does not hold a board seat or observer rights and expressed its willingness to cooperate with the CMA’s investigation.
This probe is part of a broader effort by the CMA to examine partnerships between major technology companies and AI startups. The regulator has recently launched similar investigations into Google’s collaboration with Anthropic and Microsoft’s ties with OpenAI and Inflection AI.
