The FTC also discusses the potential impact of open-source on generative AI development and the possible unfair methods of competition that could be used by incumbents in the market. These include bundling and tying, exclusive dealing or discriminatory behavior, and M&A activity. The FTC warns that network and platform effects could supercharge harms from unfair conduct, and stresses the importance of legal and policy intervention to prevent this. The FTC is committed to supporting a vibrant marketplace where new businesses can compete and innovation can continue.
Key takeaways:
- Generative AI, which creates new content, has the potential to transform many industries, but its development and deployment could be influenced by a few companies controlling essential inputs such as data, talent, and computational resources.
- The FTC’s Bureau of Competition is focused on ensuring open and fair competition in the generative AI market, and is concerned about potential antitrust violations that could distort competition and innovation.
- Open-source models could democratize access to generative AI, but there are concerns about misuse and tactics that could undermine long-term competition. The control of essential building blocks in a proprietary ecosystem could determine market success.
- Incumbents could use unfair methods of competition, such as bundling, tying, exclusive dealing, discriminatory behavior, and M&A activity, to consolidate market power. Network and platform effects could also be leveraged to maintain dominance and limit competition.