Microsoft acquires AI startup Personal – No review by EU antitrust regulators

European antitrust regulators will not scrutinize Microsoft's acquisition of employees from the AI startup Inflection. As announced by the European Commission, seven member states have withdrawn their requests to review the deal. This step was taken following a ruling by the highest European court, which prohibited the EU antitrust authority from examining cases that fall below the merger revenue threshold. The judges also emphasized that EU antitrust regulators should not encourage their national counterparts to refer such cases. Critics referred to these extensive merger control powers as regulatory overreach. The Commission, on the other hand, warned that such acquisitions of startups by large companies could eliminate smaller competitors. "All seven member states that initially filed a referral have withdrawn their requests. Therefore, the Commission will not make a decision in this matter," the EU executive announced. Nevertheless, the deal represents a merger as the "new Inflection" will focus on the AI studio business. "The Commission considers the agreements between Microsoft and Inflection as a structural market change, constituting a concentration within the meaning of Article 3 of the Merger Regulation," the EU Commission stated. Microsoft welcomed the decision, emphasizing that talent recruitment promotes competition and should not be treated as a corporate merger. In March, the company hired co-founders Mustafa Suleyman, Karen Simonyan, and the majority of Inflection's 70-member team for a newly established unit called Microsoft AI to expand and consolidate its offerings in the field of artificial intelligence for consumer products.