Expert Brief - AI and Market Concentration
The Open Markets Institute and the Center for Journalism and Liberty released a pivotal new expert brief, AI and Market Concentration, outlining how artificial intelligence is becoming increasingly monopolized and proposing actionable policy solutions to ensure AI serves the public interest.
Co-authored by Max von Thun (Director, Open Markets Europe), Dr. Courtney Radsch (Director, Center for Journalism and Liberty), and Michelle Nie (EU Tech Policy Fellow), the brief examines the rising dominance of Big Tech in the AI ecosystem. It investigates how high entry barriers and anticompetitive practices threaten competition, privacy, innovation, security, and sustainability.
Policy Recommendations to Build a Fair AI Ecosystem
To address these threats, the brief outlines a comprehensive set of policy tools that governments in the U.S., EU, and UK can use to foster an open, competitive AI ecosystem:
Strengthen Merger Control:
Use existing merger regulations, such as the EU Merger Regulation, the UK Enterprise Act, and Section 7 of the Clayton Act in the U.S., to scrutinize and, if necessary, block mergers and partnerships that threaten competition in AI markets.
Enforce Antitrust Laws:
Investigate and curb anticompetitive practices using laws like Article 102 of the TFEU (EU), the Sherman Act (U.S.), and the UK Competition Act.
Utilize new digital market frameworks like the EU’s Digital Markets Act (DMA) and the UK’s Digital Markets, Competition and Consumers Act (DMCCA) to proactively safeguard competition in AI.
Impose Ambitious Remedies:
Mandate structural remedies, such as divestitures, to break up monopolistic entities and ensure interoperability between AI foundation models.
Regulate Cloud Computing as a Public Utility:
Treat cloud services as essential infrastructure, ensuring fair, transparent, and non-discriminatory access. This would prevent Big Tech from leveraging control over computing power to favor their own services or control the direction of AI innovation.
Hold Platforms Accountable to Existing Laws:
Enforce existing privacy, copyright, consumer protection, labor, and environmental laws to curb exploitative practices and ensure compliance with legal and ethical standards.
Context and Broader Open Markets and CJL Efforts:
This expert brief builds on a series of groundbreaking reports from Open Markets:
AI in the Public Interest: Confronting the Monopoly Threat (2023): Explored how large-scale AI systems reinforce Big Tech dominance in sectors like search and cloud computing.
Stopping Big Tech from Becoming Big AI (2024): Focused on specific anticompetitive practices in AI and detailed policy interventions to address them.
“By addressing these critical issues, governments have the opportunity to create an AI ecosystem that prioritizes innovation, fairness, and societal benefit over corporate concentration,” said Dr. Courtney Radsch, director of the Center for Journalism and Liberty at Open Markets.
“Today, a handful of dominant tech giants hold the reins over the future of AI and the impact it will have on our lives. Left unaddressed, this concentration of power will distort innovation, undermine resilience, and weaken our democracies. Now is not the time for a “wait and see” approach – governments need to act now to protect our futures, using the many powerful tools they already have at their disposal,” said Max von Thun, Director of Europe & Transatlantic Partnerships at Open Markets.