The rise of artificial intelligence has led to a concentration of power and profits in the hands of a few US big tech firms, namely Microsoft, Google, and Amazon. These cloud giants have developed a range of mechanisms to control the AI knowledge and innovation network, including corporate venture capital investments, strategic partnerships, and talent acquisition. By exercising network power, they are able to dictate the direction of innovation and capture rents from emerging technologies. Antitrust authorities have focused on investigating potential mergers and acquisitions, but they need to expand their scope to address the complex web of relationships between big tech firms and start-ups. The article argues that the current ecosystem is dysfunctional, with big tech firms using their centrality in global production, distribution, and innovation as a coercive tool to exercise network power.
Big Tech’s AI Empire – How Cloud Giants Control the Future of Innovation
By fostering competition among complementors, Microsoft pushes them to further focus on efficiencies related to specialization instead of attempting to diversify and become potential rivals.
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