The UK watchdog worries about the tech giant’s takeover of the AI market.
The UK's Competition and Markets Authority (CMA) fears Big Tech's increasing dominance of the artificial intelligence (AI) sector, with chief executive Sarah Cardell expressing “real concerns” over the industry's growth.
In a paper on basic AI models released on April 11, CMA highlighted the increasing connectivity and focus among developers in the technology sector, fueling the rise of generative AI tools.
The CMA paper highlights the continued involvement of Google, Amazon, Microsoft, Meta and Apple (collectively known as GAMMA) in various AI value chains.
Recognizing the potential benefits of partnering arrangements in the technology ecosystem, the regulator may undermine competition in open markets by warning of the potential risks of joint ventures and mergers.
CMA mentions a type of AI that uses vast amounts of data and computational resources to serve as the basis for various applications: “We are concerned that the fundamental model (FM) sector is developing in a way that threatens negative market outcomes.
The paper outlines three related threats to fair competition: firms controlling the resources necessary to develop general-purpose AI models, tech giants influencing the choice of AI services, and partnerships potentially consolidating market power along the value chain.
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At a legal event in Washington, D.C., focused on generative AI, Cardell highlighted the “winner-takes-all dynamics” reminiscent of an earlier era of web development.
She urged regulators to avoid repeating the mistakes of the past in managing this next phase of digital evolution. Cardel said:
“By strengthening our merger review, we hope to gain greater clarity about which types of collaborations and arrangements may fall within the scope of the merger rules and under what circumstances competition risks may arise – and this clarity will benefit businesses.”
The CMA update report lists “indicators” that could raise concerns about FM partnerships, including partners' upstream power over AI inputs and downstream power over distribution channels.
In May 2023, the CMA launched its first examination of the high-end AI market, setting out principles for the “responsible” development of generative AI. These principles are intended to inform the regulator's oversight of this rapidly growing market.
Since then, the regulator has intervened to investigate the close relationship between OpenAI, the creator of popular AI chatbot ChatGPT, and Microsoft, a significant investor in OpenAI. The revised paper addresses the rapid pace of change in the market.
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