The Competition and Markets Authority (CMA) in the United Kingdom has expressed significant concerns about the growing dominance of Big Tech in the advanced AI sector. CEO Sarah Cardell has voiced her worries over the industry’s development.
In a paper released on April 11, the CMA highlighted the increasing interconnection and concentration among developers in the cutting-edge tech sector, which is fueling the surge in generative AI tools.
The CMA’s paper specifically points out the consistent involvement of Google, Amazon, Microsoft, Meta, and Apple (collectively known as GAMMA) across various aspects of the AI value chain.
While recognizing the potential benefits of partnership arrangements in the tech ecosystem, the regulator also warns about the risks posed by dominant partnerships and integrated firms, which could undermine competition in open markets.
The CMA’s paper focuses on a form of AI called foundational AI models, which leverage extensive data and computational resources and potentially serve as the basis for various applications. The CMA states, “We are concerned that the foundational model (FM) sector is developing in ways that risk negative market outcomes.”
The paper identifies three related risks to fair competition: firms controlling crucial inputs for developing general-purpose AI models, tech giants leveraging their dominance to influence choices in GenAI services, and partnerships potentially reinforcing market power across the value chain.
During a legal event in Washington, D.C., focused on generative AI, Cardell highlighted the “winner-take-all dynamics” reminiscent of earlier web development eras. She urged regulators to avoid repeating past mistakes in overseeing this next phase of digital evolution.
The CMA’s update report outlines “indicative factors” that may raise concerns regarding FM partnerships, including partners’ upstream power over AI inputs and downstream power over distribution channels.
Last May, the CMA initiated an initial examination of the high-end AI market, releasing a set of principles for the “responsible” development of generative AI. These principles are meant to guide the watchdog’s supervision of this rapidly evolving market.
Since then, the regulator has intervened to investigate the close ties between OpenAI, the creator of the popular AI chatbot ChatGPT, and Microsoft, a significant investor in OpenAI. Its updated paper addresses the rapid pace of change in the market.