Issue Market concentration and lock-in in AI

Summary

The report expects that, as the big technology firms race to lead generative AI, large (US) companies holding vast amounts of data and computing power are likely to dominate. They strengthen their competitive position through vertical and horizontal integration, buying rivals in the same market and expanding into other parts of the production chain. New links may form in the value chain between firms that collect data, train models and offer services. This can make it harder for new players to enter and can close off AI ecosystems. The report warns that lock-in may occur, leaving other parties struggling to enter or integrate. It adds that these mostly American companies fall outside European legislation and that dependence on a handful of suppliers creates geopolitical risks.