In their states, authorities in Japan and South Korea have begun to investigate the effects of the growth of relational AI markets. Following concerns are that emerging anti-competitive practices may emerge or that the fast-moving market may be dominated by very few gamers.
In October, the Japan Fair Trade Commission began a market research on conceptual AI to observe competition at the system, design, and application levels. It will also consider whether shifts to its Antimonopoly Act and opposition plan are necessary, as described in a conversation papers.
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The Korea Fair Trade Commission, however, launched its unique AI industry study in August of 50 domestic and international athletes in AI. The KFTC stated that it will examine trends in business ties and opposition and will identify issues that might stifle competition and hurt consumers.
Japan is examining the impact of AI opposition across all technological tiers.
The local conceptual AI sector is anticipated to experience a 47, according to Japan’s opposition regulator. 2 % average annual growth rate between 2023 and 2030. The governmental body states that it is crucial to maintain a fair and competitive atmosphere in business for the correct integration of these systems within its economy and society.
The network layer
The JFTC is looking into issues like the prominent supremacy of NVIDIA in GPUs, the differences in the training data that Chinese models use or have access to, and the trouble for Chinese firms to retain their AI talent expertise when faced with the financial clout of global players.
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The design level
Japan points out that while public purpose foreign LLMs dominate in areas like multicultural ability, multi-model inputs, and inferencing, domestic players are focusing on Chinese language performance or developing specialist LLM models for certain business or industry use cases.
The application layer
The JFTC wants to know what challenges businesses face and how to promote fair and free competition in the generative AI market at the product level, where businesses are using either open source, proprietary, or internal models.
Access to GPUs is a factor in competition concerns, too
The JFTC has stated that it has not drawn any conclusions about market trends in generative AI, but it did have some areas that it would be focusing on for discussions with market players.
Access restrictions and the exclusion of competitors: The JFTC noted that new market entry opportunities and other competitive dynamics would be impacted if a small number of large enterprises are in a better position to acquire GPUs or data, or if access to other players is restricted.
Self-referencing a company’s own services: One potential power abuse could be found in generative AI models when the model’s own services appear more favorably in its inference results over those of rival businesses, causing market competition to be affected by the competition for goods and services.
The JFTC has warned about possible issues when a dominant provider of a service bundles the use of its own generative AI model as a condition of offering that service, causing competition among generative AI models.
The JFTC has raised concerns that underlying data and algorithms used by various organizations may align, leading to a change in competition, by using generative AI in parallel.
Creating partnerships: One way organizations may try to capture the market’s highly skilled talent for themselves is through forming partnerships, which the JFTC claimed could have the same-sized effects as a business transfer that would draw attention to competition.
Korea to examine AI market share concentration
The South Korean competition regulator is concerned about competition concerns given that generative AI may be a significant contributor to economic growth given the capital and compute-intensive nature of AI technology. Like Japan, Korea’s announcement notes potential risks including:
- A few powerful businesses that hold the majority of the market for AI.
- Lack of access to crucial inputs for AI development creates potential entry barriers.
The Trade Commission is conducting the study on the main market players by using provisions from its Monopoly Regulation and Fair Trade Act. The investigation will examine business activities, goods and services within the AI sector, and any unfair trade practices, it said in the statement announcing the study.
It anticipates publishing an AI Policy Report by the end of 2024 and examine competition policy that can promote innovation and fair competition in the AI industry as a result of the investigation.
Australia is also watching generative AI competition
Australia’s competition regulator, the Australian Competition and Consumer Commission, has also indicated it is watching AI market developments. The government will be given a detailed analysis of generative AI competition in its tenth report, due to be released in March 2025.
The ACCC said in the statement that it would look into potential generative AI competition problems. These might include the high barriers to market entry and the potential for large digital platforms to integrate Large Language Models ( LLMs) to strengthen and grow their market share.
Gina Cass-Gottlieb, the chair of the ACCC, stated that the organization is “following recent developments in generative AI closely. ”
“Adoption has been extensive, and this technology continues to expand and develop at a rapid pace, ” she said. Generative AI products and services may offer new opportunities, but they also may present new difficulties with significant implications for our work. ”
