German antitrust head warns AI may boost Big Tech's dominance

Alphabet's Google and Microsoft have recently become rivals in artificial intelligence

FRANKFURT (Reuters) - The head of Germany's cartel office has warned that artificial intelligence may boost Big Tech's market power and regulators should be on the lookout for any anti-competitive behaviour.

The comments by Andreas Mundt underscore regulatory concerns that tech giants, with their vast troves of user data, may get a competitive edge in the new technology used in smart homes, web search, online advertising, cars and many other products and services.

Alphabet's Google and Microsoft have recently become rivals in artificial intelligence (AI), with the latter investing heavily in OpenAI and the former building the Bard AI chatbot among other investments.

The surge in AI popularity has prompted governments around the world to try to impose rules on the use of the technology, with the European Union in a race to adopt its landmark AI rules by the end of the year.

"For us as a competition authority, it is crucial that this new technology does not further strengthen the dominance of the large corporations," Mundt told Reuters in an interview on Friday.

"The danger is very great because you need two things above all for AI, powerful servers and vast amounts of data. Big internet corporations have both," he said.

Mundt said the field was still open to competition but regulators need to ensure it remains so.

"However, models from smaller providers could also become so popular that they develop in the direction of a kind of operating system, a new platform," he said.

"Both developments are possible, and as an authority we have to be careful that any competitive potential is not buried from the outset."