Google AI partnership with Anthropic under inquiry, UK regulator says (update)

Google’s (NASDAQ:GOOG) (NASDAQ:GOOGL) partnership with artificial intelligence startup Anthropic is under inquiry, the U.K.’s antitrust agency said on Tuesday.

The Competition and Markets Authority said in a statement it is considering whether the partnership between the tech giant and Anthropic “has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”

The CMA has invited interested parties to comment on the matter before August 13.

Google shares were fractionally higher in early trading on Tuesday.

“Google is committed to building the most open and innovative AI ecosystem in the world,” a Google spokesperson told Seeking Alpha. “Anthropic is free to use multiple cloud providers and does, and we don’t demand exclusive tech rights.”

Anthropic did not respond to a request for comment from Seeking Alpha.

In May, the CMA said that a similar deal between Microsoft (MSFT) and French AI startup Mistral AI did not qualify for investigation.

Google has previously invested in Anthropic, maker of the Claude AI chatbot, as have several other tech companies, including Amazon (AMZN).

In November 2023, Google said that its artificial intelligence-focused processors, known as TPU v5e, would be used by Anthropic as the Mountain View, California-based tech giant seeks to boost its cloud computing unit amid increased competition. Anthropic said the TPUs will be used to power the startup’s large language model.

Anthropic, which was founded in 2021, announced a partnership in February 2023 with Google Cloud to deliver “responsible and reliable” AI. Google is also Anthropic’s preferred cloud provider and will continue to use its infrastructure and services.

Anthropic also has a similar deal with Amazon to use Amazon Web Services for mission-critical workloads, including safety research and future foundation model development.

(This story has been updated with comment from Google.)