Investing.com – The Federal Trade Commission is investigating whether Microsoft structured its recent deal with artificial intelligence startup Inflection to avoid government antitrust scrutiny, The Wall Street Journal reported Wednesday.
Microsoft Corp. (NASDAQ:) hired Inflection co-founders Mustafa Suleiman and Karen Simonyan and most of the startup’s staff in March to lead the tech giant’s in-house artificial intelligence efforts, including the development of products like Copilot.
Microsoft also agreed to pay Inflection $650 million as part of a licensing agreement with the startup, giving it access to its flagship artificial intelligence models, which are now available on the Azure marketplace.
Over the past year, Inflection has become one of the hottest companies in the fast-growing artificial intelligence space, raising more than $1.3 billion in a funding round led by Microsoft and NVIDIA Corporation (NASDAQ:). The company has developed a chatbot called Pi to compete with OpenAI’s ChatGPT.
Following the Microsoft deal, Inflection, under its new CEO, said it will continue to develop artificial intelligence models for enterprise applications.
The Microsoft deal has sparked some controversy over its nature, with critics accusing the tech giant of essentially poaching much of Inflection’s talent.
The company has already faced scrutiny from the Federal Trade Commission over its other artificial intelligence activities, particularly its relationship with OpenAI.