UK Drops Antitrust Probe into Microsoft and OpenAI Partnership

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The UK’s Competition and Markets Authority (CMA) has ended its investigation into Microsoft’s partnership with OpenAI, stating that the software giant does not have sufficient control over the AI company to warrant further scrutiny. The probe, which began due to concerns over antitrust issues, was focused on whether Microsoft’s involvement in OpenAI, which started with a $1 billion investment in 2019, gave it too much influence over the AI company.

Despite Microsoft acquiring material influence over OpenAI in 2019, the CMA concluded that it did not have de facto control over the company and, therefore, the partnership did not meet the criteria for a full investigation under UK merger control laws. However, the CMA made it clear that its conclusion should not be interpreted as ruling out any potential competition concerns from the ongoing partnership.

Microsoft welcomed the CMA’s decision, emphasizing that its partnership with OpenAI fosters competition, innovation, and the responsible development of artificial intelligence. The company also praised the CMA’s careful review of the commercial realities of the partnership.

The investigation into Microsoft’s ties with OpenAI is part of the CMA’s broader scrutiny of the growing relationships between major tech companies and AI startups. Other partnerships, such as those between Amazon and Anthropic, as well as Google-owner Alphabet and Anthropic, have also been under review, but none reached the threshold for deeper investigation.

The CMA recently gained additional powers to probe large tech firms deemed to have “strategic market status,” and it has already launched investigations into Apple and Google’s smartphone ecosystems and search services. However, analysts suggest that the recent appointment of Doug Gurr, a former Amazon executive, as interim chair of the CMA may signal a more lenient approach to future deal-making.

Trump Calls for Repeal of $52.7 Billion Semiconductor Subsidy Law

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Former President Donald Trump has called for the repeal of the landmark 2022 bipartisan CHIPS and Science Act, which allocated $52.7 billion in subsidies for semiconductor manufacturing and production. Trump, in a speech to Congress on Tuesday, criticized the act, describing it as a “horrible, horrible thing” and argued that the money allocated had not been effectively spent. He urged lawmakers to cancel the CHIPS Act and redirect the remaining funds towards reducing the national debt.

The CHIPS Act, signed by President Joe Biden in August 2022, includes $39 billion for U.S. semiconductor manufacturing, along with $75 billion in government lending authority aimed at bolstering the country’s tech industry and addressing national security concerns related to semiconductor imports. The law has been praised by Commerce Secretary Howard Lutnick, who previously expressed his desire to review the awards finalized under Biden’s administration, which facilitated major semiconductor firms such as Samsung, Intel, Taiwan Semiconductor Manufacturing Company (TSMC), and Micron in establishing factories in the U.S.

Trump’s remarks mark his strongest criticism of the CHIPS Act, suggesting that avoiding new tariffs would be sufficient to encourage domestic semiconductor production. Critics, however, argue that the law is crucial for securing investments, such as TSMC’s $100 billion plan to build five chip facilities in the U.S., which would create tens of thousands of jobs. New York Governor Kathy Hochul highlighted that Micron’s $100 billion investment in Central New York, which could generate 50,000 jobs, was a direct result of the CHIPS Act.

While Trump’s position may undermine the funding for key semiconductor projects, officials are concerned that repealing the law could harm Arizona’s semiconductor industry and jeopardize job creation. Recent reports also indicated significant layoffs within the U.S. Commerce Department, which oversees the semiconductor subsidies, raising questions about the future of the industry under a potential new administration.

Blackstone’s £10 Billion Data Centre Project in North East England Approved

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Blackstone, a prominent U.S. private equity firm, has received planning approval for its ambitious $13 billion “hyperscale” data centre project in North East England. The Northumberland County Council granted unanimous approval for the facility on Tuesday, with plans for the site in Blyth, Northumberland to span approximately 540,000 square metres.

The investment, which could reach up to £10 billion, will involve a large-scale data centre campus designed to meet the growing demand for data storage and cloud computing services. These “hyperscale” data centres are integral to supporting businesses, especially with the increased reliance on technologies like artificial intelligence.

The project is set to create substantial employment opportunities, with 1,200 long-term construction jobs and hundreds of positions for the operation of the centres. Additionally, up to 2,700 indirect jobs could be supported by the project. As part of the agreement, Blackstone will also contribute to a £110 million fund aimed at fostering economic growth and job creation in the region, particularly along the newly opened “Northumberland Line” railway.

This development follows the collapse of a previous plan for the site, which was originally designated for Britishvolt’s electric vehicle battery manufacturing plant before its closure last year. Blackstone’s initiative reflects the increasing demand for data centre capacity, driven by the surge in artificial intelligence and cloud computing, despite challenges in meeting this demand, according to recent research by CBRE Group.