UK CMA Issues Warning on Big Tech Dominance of AI

The UK Competition and Markets Authority (CMA) today warned that Big Tech’s dominance of the nascent AI market is anticompetitive and was orchestrated by Amazon, Apple, Google, Microsoft, Meta, and Nvidia to maintain and extend their market power in this new era.

“When we started this work, we were curious,” CMA CEO Sarah Cardell said during the opening remarks at an antitrust conference in Washington DC. “Now, with a deeper understanding and having watched developments very closely, we have real concerns.”

The CMA has been examining the “whirlwind” rise of AI and the investments and partnerships that these companies have used to solidify their respective positions. It is specifically investigating Microsoft’s unique partnership with OpenAI, the major players in the commercial cloud and AI accelerator chips market. And what it sees is obvious enough: There’s a lot of overlap in which a handful of well-known Big Tech firms seem to have their fingers in every pie. Or, as the CMA calls it, “an interconnected web of over 90 partnerships and strategic investments involving the same firms.”

Given history, the CMA also points to the risks of not moving quickly enough to regulate dominant Big Tech firms and address the “unique challenges” they pose to open and fair competition.

“We have seen instances of those incumbent firms leveraging their core market power to obstruct new entrants and smaller players from competing effectively, stymying the innovation and growth that free and open markets can deliver for our societies and our economies,” Cardell said. “We have also seen that those firms can engage in behaviors that exploit people and businesses, like undermining choice and control through harmful online architecture, or through anticompetitive tying and bundling of products and services. So, while the eventual outcomes of the paradigm shift we may be witnessing in generative AI are currently uncertain, it’s important we take what we have learned into account as we consider our response.”

The CMA argues that regulators must act immediately to ensure that a small number of firms with unprecedented market power control how AI is designed, built, deployed, and used across the world. And that this is especially important given that each of these companies is already involved in multiple antitrust battles related to market power abuses.

Next week, the regulatory body will publish a detailed technical report on AI foundation models and an updated set of principles for sustaining innovation and guiding these markets toward positive outcomes for businesses, consumers, and the wider economy.