Microsoft has told the European Commission’s competition authorities that it only entered into agreements with generative AI developers because it had no other option, unlike archrival Google which can do it all alone.

The assertions from Microsoft came in its response to the EC’s call for contributions on the healthy of competition in generative AI.

“Only one company – Google,” said Microsoft, “is vertically integrated in a manner that provides it with strength and independence at every AI layer from chips to a thriving mobile app store.”

“Everybody else must rely on partnerships to innovate and compete.”

Including poor little Microsoft.

Microsoft is not flattering Google here. It is, instead, justifying its need for alliances as it forges ahead in the brave new world of AI. “Microsoft, along with other large technology firms are [sic] dynamically pivoting to meet the AI era,” it said.

The EC is taking a close look at Microsoft’s AI behavior. Regulators have been examining the company’s $13 billion investment in OpenAI, and the company’s €15 million stake in French startup Mistral AI has also attracted attention.

In its submission, Microsoft pointed to an array of generative AI entrants, such as Anthropic, Cohere, Aleph Alpha, and – of course – Mistral AI, all of which were “developing and operationalizing generative AI-based technology.” It said competition was fierce, and “the pace of innovation is breathtaking.”

Microsoft went on to list the components needed to develop an AI technology stack, including hardware in the form of semiconductors. Nvidia might be the “undisputed leader,” but Google has been developing Tensor Processing Units (TPUs) for AI workloads for years.

Then there’s data. Google has a mountain of data in the form of its search engine index and other datasets, such as web video giant YouTube. Is Microsoft suggesting that Bing’s index is woefully inadequate in comparison? Surely not. Certainly, lawyers for The New York Times, currently suing Microsoft and OpenAI over data used for training models, would see things slightly differently.

Microsoft also notes in its submission, seen by The Reg, that Google and Apple both control assistants on their respective platforms, Android and iOS: Google Assistant and Siri. Microsoft’s earlier attempt at an assistant – Cortana – did not get a mention, although the company points out that it required multiple models to power the latest AI assistant, Copilot.

Unsurprisingly, Microsoft’s submission says, “Partnerships and investments in the AI space should be encouraged.” It adds: “They render innovation and consumer choice, preventing any player becoming ‘too big too soon’.”

After all, Microsoft is not the only company throwing investment money at AI startups. Google acquired DeepMind more than a decade ago, a relationship that has since birthed the advertising behemoth’s Gemini service.

And yes, the current antitrust framework and legislation is sufficient, according to Microsoft. Lawmakers might disagree.

The EC started to show an interest in the gen AI landscape given the surging interest from customers, and the jostling for position from the big players, each of which have started to invest in emerging developers. The Commish is also looking into the AI chip market for stifled competition.

Google is less than impressed with Microsoft’s assertions. In a statement to The Register, a spokesperson said: “We hope the Commission’s study will shine a light on companies that don’t offer the openness of Google Cloud or have a long history of locking in customers – and who are bringing that same approach to AI services.”

Whoever could it mean? ®

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• Source: https://go.theregister.com/feed/www.theregister.com/2024/03/15/microsoft_says_ai_partnerships_are/