POLITICO Magazine published an op-ed on Monday from Ganesh Sitaraman, a Vanderbilt University legal scholar and longtime aide to Sen. Elizabeth Warren (D-Mass.); and Tejas N. Narechania, a University of California Berkeley law professor. In it, they warned Washington it needs to enforce robust competition rules on the AI industry before it develops similar market concentration enjoyed by today’s tech giants. (The op-ed drew from a more expansive white paper published in October 2023.) I called the two scholars yesterday to ask them where they think the most vulnerable pressure points might be in this nascent policy field. We discussed the significant amount of entrenchment that already exists with artificial intelligence, the viability of open-source AI, and the promise of an alliance between those on both the right and left eager to regulate the field. The following conversation has been edited and condensed for clarity: Is there one particular level of the AI stack where you worry that concentration could be most harmful? Sitaraman: I don't think in terms of prioritizing any of them, because the harms are serious in each of these areas and they are slightly different in each of the areas. In the context of semiconductor manufacturing, the harms are not just about the limited number of manufacturers, but also their geographic location. That's a difference in the kind of harm, because it has national security and resilience implications. Then there are the cloud questions, which don't raise the same national security issues that chips do. Each of these are important, but as we talked about in the paper, some of the same policy tools can address the problems at each of these layers, too. What do you see as the easiest regulatory lift for those in government hoping to rein in any AI monopoly now? Narechania: It depends on what regulator we care about. In chips, given the national security concerns about their use, we can see an impact and have seen some moves to fund more chip development and production here in the United States. We're investing in, potentially subsidizing new competitive providers. The fact that we've done it suggests that we could potentially do more and that's a place where there's room for movement. Having said that, there are also clear analogues to some of the other things that we're talking about: For example, the FCC is moving on net neutrality now. Congress has talked about and thought about non-discrimination regimes, and favoritism and self-preferencing in a variety of contexts, and so given the attention that's being paid to those concerns I think there is a possibility to move on on that. Is open-source AI a meaningful driver of competition? Sitaraman: I'm skeptical of the ability of open-source to solve the problems of concentration in the AI sector for a few reasons. First, often when people talk about open-source and about “open” or “closed,” in reality what we're dealing with is something more like a spectrum of how open something is. This is not really precise enough for the conversation. Second, the layers where concentration occurs, like chips and cloud services, are not solved by open-source. If you think that open-source models are going to solve the problems of concentration across the AI stack, that's just not the case. Third, one of the challenges for open-source firms at the model layer is that they are dependent on the oligopoly at the lower layers of the stack, and what that means is that we may see in the future foreclosure or pressure put on open-source model developers through things like self-preferencing, or other kinds of benefits that a vertically integrated company that provides both cloud services and their own models might engage in. That’s partly the reason why you have nondiscrimination rules and structural separations between these layers in other sectors. The final thing is that it's not obvious that open-source in a lot of other areas has done what people think it might do here. Firefox, while it had a lot of innovations, is not the dominant browser. Narechania: I have nothing to add to that. What do you think of the Biden administration’s steps to address competition in the Executive Order on AI? Sitaraman: I think the EO does address competition in an important way, and there's good evidence that people in the government see this as an important issue. The Office of Management and Budget, after the EO came out, issued another document that specifically asked agencies to consider competition questions, including questions around self-preferencing. Narechania: One of the things that's really exciting and heartening about the EO is that it expressly acknowledges and addresses the competition concerns. Government agencies are starting to think about their procurement decisions through the lens of competition, like whether they're potentially entrenching a particular player or monopolist in that space when they decide who to buy from. We have to see what the rest of the executive branch does now that they have these marching orders. Sitaraman: When you look at the Biden administration's approach overall to competition it’s been very positive on these issues, from the appointments of [Assistant Attorney General for Antitrust] Jonathan Kanter and [Federal Trade Commission Chair] Lina Khan and [former Special Assistant to the President for Technology and Competition Policy] Tim Wu, to the work that they've been doing across the board with their Competition Council and executive orders. How worried are you that this will change if Biden leaves the White House? Sitaraman: One of the things that I've been encouraged by is that there has been bipartisan interest in these issues. You have some conservatives who have been out very aggressively talking about the dangers of big tech; you have Lindsey Graham and Elizabeth Warren working on a regulating big tech bill and calling for a new commission. You have [Republican Sen. Chuck] Grassley and [Democratic Sen. Amy] Klobuchar on the antitrust bill that they had in the Senate last year. This is a great story and one where we should be encouraged that there are more people interested in these issues, which across the board both Republicans and Democrats for many decades were not interested in. This is a sea change we've seen in the last few years, and I think that's a very positive thing.
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