The regulator said it had reviewed evidence and decided to examine whether Telegram has failed, or is failing, to meet its legal duties on illegal content under the Online Safety Act 2023.

The case adds to complaints on online platforms operating in the United Kingdom, where authorities want stronger protection for children from harm online.

Ofcom said the law requires platforms to reduce risks linked to illegal material and act where such content appears. It added that companies must be able to show they are meeting those duties.

Telegram rejected the allegations.

The company said it “categorically” denied Ofcom’s accusations. It added that since 2018 it had “virtually eliminated” the public spread of child sexual abuse material through detection algorithms.

Telegram also said, “We are surprised by this investigation and concerned that it may be part of a broader attack on online platforms that defend freedom of speech and the right to privacy.”

The regulator also opened separate investigations into Teen Chat and Chat Avenue. It said it was unconvinced that both platforms were doing enough to protect children from grooming risks.

Suzanne Cater, Ofcom’s director of Enforcement, said, “These firms must do more to protect children, or face serious consequences under the Online Safety Act.”

The inquiry comes as Keir Starmer’s government pushes for tighter online safeguards, especially for younger users.

Telegram has faced similar cases elsewhere. In February, Australia’s online safety regulator fined the company after delays in answering questions about measures against child abuse and violent extremist material.

The UK law is considered one of the strictest internet safety frameworks in the world. It places direct responsibility on platforms to tackle illegal and harmful content or risk enforcement action.

The company confirmed on Thursday that it will not proceed with the British phase of the project for now, saying work will resume only when conditions support long-term investment.

Stargate UK, developed with Nvidia and British developer Nscale, was announced in September 2025 as part of a plan to expand global data centre capacity.

The project was expected to deploy up to 31,000 AI chips and strengthen the country’s ability to run its own artificial intelligence systems.

That capacity, usually called sovereign compute, allows a country to manage sensitive data and AI workloads locally instead of relying on overseas providers.

OpenAI said in a statement: “We see huge potential for the UK’s AI future. AI compute is foundational to that goal, we continue to explore Stargate UK and will move forward when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment.”

The decision is a setback for the UK government as Prime Minister Keir Starmer has made artificial intelligence central to his economic plans and wants Britain to attract more global tech investment.

Officials insist talks are still ongoing. A spokesperson said the government is “continuing to work with OpenAI and other leading AI companies to strengthen UK compute capacity”.

At the same time, they pointed to more than £100 billion in private investment that has flowed into the UK’s AI sector since 2024.

The cost of energy is also a big issue. Britain has some of the highest electricity prices in Europe, and large data centres require vast amounts of power to run and cool advanced chips. Regulation is another concern, especially those around data use and copyright.

OpenAI has been expanding its data centre footprint in other regions. Its Stargate programme includes projects in the United States, Norway and the United Arab Emirates. The first major campus is already underway in Texas.

The pause in the UK also comes as the company strengthens its focus. It has scaled back some side efforts and is concentrating more on core services like ChatGPT.

Competition is increasing, with companies such as Anthropic and Google pushing ahead with their own systems.

Despite the Stargate project delay, OpenAI says it will continue discussions with the UK government, including plans to support public services with its technology.

For now, the project is on hold, with no timeline for when work might begin.

His comments, given in an interview with the BBC, add urgency to high global concerns that the sector is inflating beyond what current adoption and revenue models can support.

Pichai described today’s AI bubble as an “extraordinary moment”, and also pointed to what he called “elements of irrationality” in the market. 

The concern is in line with earlier alarms sounded during the dotcom era, when valuations rose without clear foundations. Analysts now warn that a similar pattern is emerging in AI as venture capital builds startups and chipmakers at a pace that outstrips real-world usage.

He was explicit about the risks when asked how Alphabet would handle a severe downturn. “I think no company is going to be immune, including us,” he said. 

Alphabet’s stock has jumped 46% this year, buoyed by optimism over its capacity to challenge OpenAI and Microsoft in advanced model development. However, the same rally has led to talks in the United States and the United Kingdom over whether markets are pricing in far more than the technology can reasonably deliver.

In Britain, policymakers have already noted that the sector may be drifting into bubble territory. Despite these warnings, Alphabet has doubled down on its UK footprint. 

In September, the company committed £5 billion over two years to expand AI infrastructure, build a new data centre, and increase funding for DeepMind, its London-based research arm. 

Pichai also confirmed that Google will begin training models in the UK, an important step for Prime Minister Keir Starmer, who wants the country to become the world’s third AI superpower after the US and China.

The company’s aggressive UK plans align with that goal, but they also point to a bigger dilemma. Pichai admitted that AI’s “immense” energy requirements are slowing Alphabet’s progress towards its net-zero targets, as the growing demand for high-performance computing drives up power consumption across its operations. 

The admission shows an industry struggle on how to balance the speed of innovation, the AI bubble, with the environmental cost of the infrastructure required to support it.

Pichai’s warning lands as investors, regulators and governments are becoming more uneasy about the sustainability of AI valuations and the stress placed on energy grids.