On February 8, the Competition Authority took up a subject that was important to say the least: the competitive functioning of the generative artificial intelligence sector. Congratulating himself on having delivered an opinion in the space of five months – far from the usual 18 months – its president Benoît Cœuré affirms that there is the desire to intervene fairly quickly, “even if it means coming back to it later”The observation is simple: technology is evolving rapidly and so is the competitive landscape.
Three reasons pushed this administration to look into the subject. “The generative AI that has developed in recent months is a general-purpose technology that can potentially change working methods and distribution of tasks in all sectors of the economy and have major consequences for the economy and the economy. 'job”, notes Benoît Cœuré. The second reason is simple: several actors have privileged access and the risk of control by them constantly looms.
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Finally, several French and international initiatives have been carried out in the field, particularly from a regulatory point of view. For all these reasons, the authority therefore took action and launched a public consultation in February in order to meet with the various stakeholders.
Technological giants present throughout the value chain
The opinion thus takes into account a range of players present throughout the value chain of this sector, starting with the technological giants. “Alphabet and Microsoft are present across the entire value chain, while Amazon, Apple, Meta and Nvidia are only present on certain specific layers”we can read.
Alongside them, there are model developers – start-ups and research laboratories specializing in AI, such as Anthropic, HuggingFace, Mistral AI and OpenAI. The latter have, over time, formed partnerships with one or more digital giants, such as OpenAI with Microsoft and Anthropic with Amazon and Google. “They can adopt a proprietary or open approach to the dissemination of their models,” notes the Authority.
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AI accelerator and cloud service providers have their share of responsibility
Upstream, other – equally important – players exist: IT component suppliers such as Nvidia (recently becoming the world's largest market capitalization thanks to the AI boom), and cloud service providers such as AWS, GCP or Microsoft Azure.
From these actors arise certain barriers put in place – naturally or not – by them. The following elements are thus highlighted: the need to use specialized processors for AI, the importance of cloud services, the need to have large volumes of data, the quest for rare and highly sought-after skills, the need significant funding.
Faced with this observation, the administration draws a comparison with the oligopolistic market that is the cloud market – held in large majority by hyperscalers. According to Benoît Cœuré, this type of market has direct consequences on the field of generative AI.
Limiting the barriers to access to generative AI
To limit these barriers, the Competition Authority therefore issues a list of recommendations. In a few words, this is due to the following points: the existence of public supercomputers – including Jean Zay in France –, the emergence of technological innovations reducing the need for computing power and data, as well as the existence of open models, even if this concept covers many ambiguities, as Benoît Cœuré points out. In detail, ten proposals have therefore been developed and presented.
At European level, the Commission should pay particular attention to the development of model-as-a-service (MaaS) services to assess the possibility of designating companies providing such services as gatekeepers under the DMA.
In implementing the provisions of the SREN law on cloud assets, the DGCCRF should pay particular attention to the use of these assets in the field of AI. Continuing with regulatory efforts, the future AI Office and the competent national authority in France will have to ensure on the one hand that the implementation of the regulation does not hinder the emergence or expansion of smaller operators, and on the other hand that the largest players in the sector do not misuse the text to their advantage.
Providing more equal access to computing power and data
The development of access to computing power is also a key topic highlighted in the proposals. This involves “continue investment in the development of supercomputers at European level”, “propose an open and non-discriminatory framework” for access to public supercomputers against payment”but also of “set criteria for opening generative AI models trained on these supercomputers” in connection with the AI Act.
The value of data is also highlighted: the Authority proposes to “facilitate the provision of data from the public and private sphere for the training or fine-tuning of generative AI models, and encourage public or private initiatives aimed at disseminating French-speaking data, whether texts, images or videos.
Finally, ranked in position number 10, this proposal is however one of the most important: “it is necessary to ensure better transparency of minority stakes in the sector”. In the context of the obligation to provide information on concentrations provided for in Article 14 of the DMA, the Commission could in fact request information on minority interests held in the same sector of activity as the target.
A call to order more than a message of prevention
According to the president of the Competition Authority, “This opinion will serve as a reading and analysis grid for the various market players.” Asked about existing agreements between French and American market players, he believes that “the way Mistral AI structures its partnerships today does not concern us so much since they are distribution agreements”. And to add: “What concerns us are exclusivity agreements.”
It remains to be seen whether the various practices and issues cited in this report can be better managed in the future, in particular by working with other administrations, first and foremost the European Commission. The Authority also specifies that its recommendations do not require a legislative initiative and rather aim to promote the competitive dynamics of the sector. However, it seems that it is already too late to warn, the message having the air of more of a call to order, a reminder that many technological players have no use for.
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