Microsoft Faces UK Competition Investigation Over Hiring of AI Startup’s Founder, Key Staff

FILE - Mustafa Suleyman co founder and CEO of Inflection AI speaks to journalist during the AI Safety Summit in Bletchley Park, Milton Keynes, England, on Nov. 1, 2023. The Competition and Markets Authority said Tuesday, July 16, 2024 that its review of the hirings from Inflection AI turned up “sufficient information” to open an investigation. Microsoft hired Inflection’s co-founder and CEO Mustafa Suleyman to head up its consumer artificial intelligence business, along with several top engineers and researchers. (AP Photo/Alastair Grant)
FILE - Mustafa Suleyman co founder and CEO of Inflection AI speaks to journalist during the AI Safety Summit in Bletchley Park, Milton Keynes, England, on Nov. 1, 2023. The Competition and Markets Authority said Tuesday, July 16, 2024 that its review of the hirings from Inflection AI turned up “sufficient information” to open an investigation. Microsoft hired Inflection’s co-founder and CEO Mustafa Suleyman to head up its consumer artificial intelligence business, along with several top engineers and researchers. (AP Photo/Alastair Grant)
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Microsoft Faces UK Competition Investigation Over Hiring of AI Startup’s Founder, Key Staff

FILE - Mustafa Suleyman co founder and CEO of Inflection AI speaks to journalist during the AI Safety Summit in Bletchley Park, Milton Keynes, England, on Nov. 1, 2023. The Competition and Markets Authority said Tuesday, July 16, 2024 that its review of the hirings from Inflection AI turned up “sufficient information” to open an investigation. Microsoft hired Inflection’s co-founder and CEO Mustafa Suleyman to head up its consumer artificial intelligence business, along with several top engineers and researchers. (AP Photo/Alastair Grant)
FILE - Mustafa Suleyman co founder and CEO of Inflection AI speaks to journalist during the AI Safety Summit in Bletchley Park, Milton Keynes, England, on Nov. 1, 2023. The Competition and Markets Authority said Tuesday, July 16, 2024 that its review of the hirings from Inflection AI turned up “sufficient information” to open an investigation. Microsoft hired Inflection’s co-founder and CEO Mustafa Suleyman to head up its consumer artificial intelligence business, along with several top engineers and researchers. (AP Photo/Alastair Grant)

British regulators opened a preliminary investigation on Tuesday into Microsoft's hiring of an AI startup's key staff over concerns that it could thwart competition in the booming artificial intelligence market.

The Competition and Markets Authority said its review of the hirings from Inflection AI, including its co-founder and CEO Mustafa Suleyman, turned up “sufficient information” to open an investigation.

Microsoft hired Suleyman to head up its consumer artificial intelligence business earlier this year, and brought over several top engineers and researchers. Suleyman co-founded the AI research lab DeepMind, which is now owned by Google, before setting up Inflection and is considered an influential figure in the AI world, The AP reported.

The watchdog has indicated that it was assessing whether the hirings amount to a merger that results in “a substantial lessening of competition” in the UK's AI market, in breach of the country's antitrust rules.

“We are confident that the hiring of talent promotes competition and should not be treated as a merger," Microsoft said in a statement. "We will provide the UK Competition and Markets Authority with the information it needs to complete its inquiries expeditiously.”

The British watchdog has until Sept. 11 to decide whether to give its approval or escalate the probe into an in-depth investigation. The authority has the power to reverse deals or impose fixes to address competition concerns.

Authorities on both sides of the Atlantic have become concerned about how the biggest technology companies are gobbling up the talent and products of innovative AI startups without formally acquiring them.

Three members of the US Senate wrote last week to antitrust enforcers at the Justice Department and the Federal Trade Commission, urging them to investigate Amazon's purchase of San Francisco-based Adept. The deal will result in Adept's CEO and key employees going to Amazon and giving the e-commerce giant a license to Adept’s AI systems and datasets.



DeepSeek Faces Expulsion from App Stores in Germany

FILE - The smartphone apps DeepSeek page is seen on a smartphone screen in Beijing, Tuesday, Jan. 28, 2025. (AP Photo/Andy Wong, File)
FILE - The smartphone apps DeepSeek page is seen on a smartphone screen in Beijing, Tuesday, Jan. 28, 2025. (AP Photo/Andy Wong, File)
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DeepSeek Faces Expulsion from App Stores in Germany

FILE - The smartphone apps DeepSeek page is seen on a smartphone screen in Beijing, Tuesday, Jan. 28, 2025. (AP Photo/Andy Wong, File)
FILE - The smartphone apps DeepSeek page is seen on a smartphone screen in Beijing, Tuesday, Jan. 28, 2025. (AP Photo/Andy Wong, File)

Germany has taken steps towards blocking Chinese AI startup DeepSeek from the Apple and Google app stores due to concerns about data protection, according to a data protection authority commissioner in a statement on Friday.

DeepSeek has been reported to the two US tech giants as illegal content, said commissioner Meike Kamp, and the companies must now review the concerns and decide whether to block the app in Germany, Reuters reported.

"DeepSeek has not been able to provide my agency with convincing evidence that German users' data is protected in China to a level equivalent to that in the European Union," she said.

"Chinese authorities have far-reaching access rights to personal data within the sphere of influence of Chinese companies," she added.

The move comes after Reuters exclusively reported this week that DeepSeek is aiding China's military and intelligence operations.

DeepSeek, which shook the technology world in January with claims that it had developed an AI model that rivaled those from US firms such as ChatGPT creator OpenAI at much lower cost, says it stores numerous personal data, such as requests to the AI or uploaded files, on computers in China.