The UK’s competition regulator has expressed “real concerns” that the biggest technology companies, including Apple, Amazon and Microsoft, are using their dominance in the world of artificial intelligence in a way that could harm consumers.
The Competition and Markets Authority (CMA) is looking at AI foundation models, which are the powerful digital engines of AI, including the large language models that power services such as ChatGPT, Google Bard and Claude, and are trained on massive data sets.
The engines can generate output such as code or images from human language instructions and underpin many of the new developments and technologies within the AI sector.
The authority has identified 90 partnerships and strategic investments involving the largest tech companies, specifically Google, Apple, Microsoft, Meta Platforms, Amazon, and Nvidia, the leading supplier of AI computer chips.
Along with these partnerships, the regulator said that these big tech companies already controlled critical resources, such as raw data and computing power, for developing generative AI models and their potential routes to market given their ownership of app stores and software platforms.
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The authority also said it was determined to learn from the past decade, when power in the digital world became concentrated in the hands of a small number of businesses.
As AI develops rapidly with the potential to create social upheaval, for example by replacing jobs, global regulators want to ensure that big tech is not able to shape key AI markets to their own advantage.
The authority started its review of AI foundation models in May last year, publishing its initial report in September. Since then, concern over a potential lack of competition has only grown.
Sarah Cardell, chief executive of the CMA, said: “The essential challenge we face is how to harness this immensely exciting technology for the benefit of all, while safeguarding against potential exploitation of market power and unintended consequences.”
She added that the CMA was determined to “apply the lessons of history” at what the authority described as a “pivotal moment” in the emergence of a new, transformative technology.
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“When we started this work, we were curious,” Cardell said. “Now, with a deeper understanding and having watched developments very closely, we have real concerns.”
The CMA is not the only regulatory authority investigating big tech’s dominance of artificial intelligence. Lina Khan, chairwoman of the Federal Trade Commission, the US regulator, also launched an inquiry into generative AI investments and partnerships this January.
France’s antitrust regulator launched a public consultation this month, warning that the sector was rapidly taking shape around companies that “already have a strong presence in adjacent markets”, the authority said.
The CMA has already announced a formal review of Microsoft’s multibillion-dollar partnership with OpenAI, over whether the pairing is really a merger of the two companies. Cardell added that it was “keeping very close watch on current and emerging partnerships”.
The watchdog added that along with its existing powers, such as those that allow it to review mergers and acquisitions, it could also use new tools under the Digital Markets, Competition and Consumer Bill to potentially take action against big tech.
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The new report and investigation is just one in a number of battles between regulators and big tech companies, whose dominance is being challenged in fields well beyond artificial intelligence.
The CMA already reviewed Microsoft’s acquisition of the gaming publisher Activision Blizzard, and in the US the Department of Justice has sued Apple for monopolising smartphone markets.
The Federal Trade Commission has also sued Amazon for maintaining monopoly power and the European Union’s competition watchdog has been investigating Google’s online display advertising business since 2021.
