Big Tech’s expanding market power through generative artificial intelligence will be scrutinised by the national competition watchdog in the final interim report of its five-year Digital Platform Services inquiry.
An Australian Competition and Consumer Commission (ACCC) issues paper, released on Thursday, says integrating large language models (LLM) into digital platforms could greatly increase user data collection, raising more barriers to entry for competitors and potentially limiting innovation.
LLMs could also make it easier for big tech to continue “to engage in anti-competitive practices” previously observed by the regulator, like “anti-competitive self-preferencing, tying [requiring the purchase of additional products] and data access restrictions”.
The inquiry follows similar scrutiny overseas and warnings from local AI experts that global tech companies could dominate the technology at the expense of local businesses, eventually hollowing out the Australian economy.
The ACCC issues paper kicking off the inquiry was released the same week that competition regulators in the United States, European Union, and United Kingdom issued a short joint statement on competition in generative AI foundation models and AI products.
“Adoption has been extensive, and this technology continues to expand and develop at a rapid pace. Generative AI products and services may present new opportunities, but also new challenges with major implications for our work,” ACCC chair Gina Cass-Gottlieb said on Thursday.
Potential competition issues for artificial intelligence products will be among a number of other emerging issues considered in the new inquiry. Online gaming marketplaces and small business issues in cloud computing, including “access to networks, servers, applications, and storage” will also be scrutinised.
The final interim report will also update previous inquiries, such as the 2020 report into online private messaging and the 2021 report on app marketplaces. But it does not intend to revisit the potential impact of generative AI on general search services or consumer cloud storage that were examined by the ACCC last year.
The tenth interim report will also look to major developments in digital platform markets and international legislative advances for lessons that can be applied in Australia
Ms Cass-Gottlieb said the new inquiry is a chance to “take a global view and see what challenges and opportunities exist worldwide”.
The issues paper outlines significant legislative advances in the European Union, Germany, India, South Korea, Japan, and the UK. However, Ms Cass-Gottlieb acknowledges that their “full impact may not be clear” given the recency of the legislation.
“The ACCC’s work on digital platforms over the past five years has already led to changes in our economy and to benefits for consumers. But Australia can learn and benefit from developments elsewhere,” Ms Cass-Gottlieb said.
“We are now asking consumers, business owners and others to share their views on the issues we outline so that they can help shape the final report.”
The final report will be handed to the federal government by the end of March 2025.
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