CMA's Potential Competition Concerns For Foundation Models/Generative AI

The CMA has published an update paper building upon its initial review of Foundation Models (FMs) (the technology underpinning generative AI tools such as ChatGPT).

The CMA is concerned that the ways in which the sector is developing risk negative market outcomes. It sets out three key risks to competition:

1. Firms that control critical inputs for developing FMs may restrict access to them to shield themselves from competition.
2. Powerful incumbents could exploit their positions in consumer or business facing markets to distort choice in FM services and restrict competition in FM deployment.
3. Partnerships involving key players could reinforce or extend existing positions of market power through the value chain.