CMA launches review into AI market

1. ensuring that the CMA has sufficient information to take informed decisions in relation to its work;
2. create an early understanding of the market for foundation models and how their use could evolve;
3. understand what opportunities and risks these scenarios could bring for competition and consumer protection; and
4. understand what competition and consumer protection principles will therefore best guide the development of these markets going forward.

Foundation models are a type of artificial intelligence (“AI”) technology that are trained on vast amounts of data that can be adapted to a wide range of tasks and operations. Foundation model applications include chatbots, writing assistant and code writing, and generation of images for artistic or commercial purposes.

The focus of the initial review is on the following three themes:

1. competition and barriers to entry in the development of foundation models;
2. the impact foundation models may have on competition in other markets; and
3. consumer protection.

The CMA recognises there are other important questions raised by foundation models – copyright and intellectual property, online safety, data protection, security and more – but these are not included in the scope of the review.

The CMA has asked for submissions from stakeholders by 2 June 2023, and is aiming to publish a report setting out its findings in September 2023. The CMA will use the findings of the initial review in a number of ways, to:

1. inform the CMA’s implementation of the government’s approach to AI regulation, and any recommendations that the CMA may make to the government (including the Office for AI), other regulators (including the DRCF), as well as any guidance to suppliers, developers, businesses and end users.
2. enable the CMA to decide whether further consideration of an issue is or is not appropriate, thereby facilitating the efficient and effective use of the resources of the CMA and other persons.

In March 2023, the UK Government published its white paper on AI (