In today’s blog post, the Federal Trade Commission’s Office of Technology expressed concern about potential anti-competitive issues in the field of generative AI.
The agency said LLM and other AI-powered generation tools rely on certain key components, including large datasets, skilled engineering and research teams, and high-performance computing power used during the technology’s training phase. but writes that these may be out of reach. A few companies in this field.
If a single firm or group of small firms were to monopolize any of these components, they could manipulate that control to stifle or distort competition within the sector, the FTC wrote.
“Generative AI can raise a variety of competitive concerns. In particular, controlling one or more of the key components that generative AI depends on could impact competition in the generative AI market. There is,” the official wrote in the post.
The FTC says companies will need both engineering and specialist talent to develop and deploy generative AI products. However, such talent shortages in the field can lead to anti-competitive practices such as worker lock-in. For example, if Google or OpenAI banned former engineers from joining another generative AI company, it would dry up the number of engineers who could help the competition.
Some tech companies are notorious for forcing employees to sign non-compete agreements when they leave, threatening legal action if employees take jobs with direct competitors.
The agency also said market incumbents could use unfair means such as bundling, tying, exclusive deals and other discriminatory practices to maintain an edge.
Moreover, generative AI systems require large amounts of computational resources, are expensive and may be controlled by a few companies, which can lead to potential anti-competitive practices.
For example, Microsoft is not only an investor and partner of OpenAI, but also the exclusive provider of OpenAI’s computing power. Hypothetically, Microsoft may have an edge on OpenAI in terms of price, performance and priority.
The FTC also touched on an open-source model aimed at democratizing access to AI, writing that the technology could be abused or used to crowd out competition.
“As the competition issue around generative AI continues to evolve, the Competition Bureau will work closely with the Technology Bureau and utilize a full range of tools to identify and address unfair competition methods,” the agency wrote.
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