UK To Investigate Amazon’s $4 Billion Investment In Anthropic

The UK’s Competition and Markets Authority (CMA) has confirmed it has begun an investigation into Amazon’s partnership with AI startup Anthropic.

The British competition regulator announced on Thursday a merger inquiry to investigate Amazon.com partnership with Anthropic. It said it had until 4 October for its Phase 1 decision to either refer the artificial intelligence (AI)-focussed partnership for a deeper Phase 2 probe, or clear it of competition concerns.

The CMA decision comes after the competition regulator had recently confirmed it had launched a similar probe on Alphabet’s collaboration with Anthropic.

AI concerns

That stemed from Alphabet’s decision in February 2024 to invest about $300 million (£249m) in Anthropic.

The British competition regulator has become increasingly concerned at the state of the AI sector. Last year the CMA had confirmed it was investigating Foundation Models (FMs), as the market continues to develop at a “whirlwind pace”.

Then this year the CMA said this year it has “real concerns” with AI Foundation Models (FMs) that are controlled by a small number of tech firms.

The CMA said at the time that it had identified an “interconnected web of over 90 partnerships and strategic investments involving the same firms: Google, Apple, Microsoft, Meta, Amazon, and Nvidia (the leading supplier of AI accelerator chips).”

The CMA is also seeking comments and feedback over Microsoft’s hiring of former employees and related arrangements with Inflection AI.

Amazon, Anthropic investigation

It should be remembered that Amazon has invested even more money into Anthropic, compared to Google.

In September 2023 Amazon had made an initial investment of $1.25 billion in Anthropic, but also stated it had plans to invest up to $4 billion.

Then in March 2024 Amazon pumped an additional $2.75 billion into the San Francisco-based Anthropic, completing its $4 billion investment.

Founded in 2021 by former OpenAI executives, including siblings Daniela and Dario Amodei, Anthropic in January 2024 had released a limited test of a chatbot named Claude that offers features similar to ChatGPT.

In April 2024 the CMA announced it had expanded its investigation into the AI sector and its key players, inviting interested third parties, to comment on the partnerships between Microsoft and Mistral AI, as well as Amazon and Anthropic.

Amazon response

“Amazon’s collaboration with Anthropic does not raise any competition concerns or meet the CMA’s own threshold for review,” an Amazon spokesperson told Reuters in an emailed statement.

“Amazon holds no board seat nor decision-making power at Anthropic, and Anthropic is free to work with any other provider (and indeed has multiple partners),” the spokesperson added, echoing comments from an Anthropic spokesperson.

“Our strategic partnerships and investor relationships do not diminish our corporate governance independence or our freedom to partner with others,” an Anthropic spokesperson told Reuters.

“We intend to co-operate with the CMA and provide them with a comprehensive understanding of Amazon’s investment and our commercial collaboration,” the Anthropic spokesperson said.

Antitrust regulators around the world have become increasingly concerned by the deals struck between smaller AI startups and big tech giants.

Regulators in the United States, European Union and Britain in July had signed a joint statement promising to work together to safeguard fair competition in the industry, Reuters noted.