AI race: Satya Nadella says Google should've been the 'default winner'

Microsoft's response came as a reaction to a consultation initiated by the European Commission on generative AI competition in the region.

Digital Desk: Microsoft CEO Satya Nadella acknowledged Google's dominance in the AI arena, stating that Google should have been the "default winner" due to its extensive resources and capabilities. Nadella criticised both Google and Apple for enjoying a competitive edge in generative artificial intelligence, particularly in Europe.

Microsoft's response came as a reaction to a consultation initiated by the European Commission on generative AI competition in the region. According to Microsoft, Google's ownership of Alphabet and its extensive data reserves, along with AI-optimised chips, place it ahead in the generative AI space. Microsoft highlighted Google's self-supply of AI semiconductors and access to proprietary data from Google Search Index and YouTube as significant advantages.

Nadella's statement underscores the growing significance of generative AI, with both Google and Microsoft investing heavily in products and services capable of producing human-like responses to written prompts. While Microsoft has invested billions in OpenAI's ChatGPT, Google has been developing its large language models (LLMs), such as Gemini.

Microsoft pointed out Google and Apple's dominance in AI-powered voice assistants, citing Google Assistant and Apple's Siri as examples. Both companies are well-positioned to leverage their existing voice assistants into leadership positions in generative AI, making it difficult for new entrants to compete.

Google responded by drawing attention to an ongoing investigation by EU antitrust regulators into Microsoft's alleged competitive advantage in the Cloud business. The tech giant emphasised the importance of openness and customer-centric approaches in AI services.

The EU's scrutiny extends beyond Microsoft, with regulators also investigating investments by Google and Amazon in startups like Anthropic. Additionally, Apple's acquisition of Canadian startup DarwinAI signals its commitment to strengthening its AI capabilities.

The exchange between Microsoft and Google underscores the intensifying rivalry in the AI landscape, with major tech players competing for supremacy in this increasingly critical field.