GVH launches market analysis on the impact of artificial intelligence
NCA to explore the impact of technology on competition and consumer behaviour
Budapest, 4 January 2024 - The Hungarian Competition Authority (GVH) is launching a market analysis to examine the impact of artificial intelligence on market competition and consumer choice. The explosive growth of new technology could distort competition in digital sectors and leave consumers more vulnerable, and the NCA is exploring these risks in advance.
Artificial Intelligence (AI) is a rapidly evolving family of technologies that is already impacting consumers' daily lives, often without their knowledge. With the rapid development of AI-based tools and their integration into existing digital services, the technology could soon become a dominant part of the daily lives of individuals and businesses, and in time even of government. The further development of AI-based technology and its lawful and fair use can contribute to a wide range of economic and societal benefits, but also entails significant risks.
The explosive growth, exponential development and accelerated market uptake of AI has led to two main areas of concern, which are the main focus of the GVH's investigators:
AI-based technology may pose a threat to fair competition. AI is currently considered a new and innovative technology and its development currently requires very large resources. Only the largest technology giants currently have sufficient resources - and the technological expertise to facilitate development - to gain a significant competitive advantage in the market. As a consequence, the practical application of artificial intelligence may become a privilege for a narrow group of companies, which could distort market competition in digital sectors in the future.
AI-based technology may leave consumers in a more vulnerable position. In the digital space, there are a number of data collection and advertising practices that can be dangerous for consumers. By using AI, businesses can take the collection and use of consumer data to a new level, as well as the use of 'dark patterns' and personalised advertising. A prominent example of this risk is the operation of chatbots, where the consumer is unaware whether the response they receive from the AI is based on a credible source or the result of a paid promotion.
The Hungarian Competition Authority pays particular attention to investigating the market behaviour of large technology companies and online platforms that affect the interests and position of a significant number of consumers and businesses. In recent years, the GVH has imposed competition remedies on Google and PayPal, among others, and has imposed significant competition fines on Apple and Booking.com in Hungary.
The national competition authority is also currently investigating the behaviour of Viber, part of the Rakuten group, and in 2023 it opened proceedings against Microsoft for possibly failing to adequately inform users about certain features of its search engine with artificial intelligence chat functionality. The GVH concluded its investigation into TikTok at the end of November, in which the Hungarian competition authority achieved results with global impact.
As the issue of artificial intelligence is increasingly being raised in proceedings against technology giants, the market analysis now launched will support the competition authority's effective competition enforcement activities.
A notice setting out the investigative steps, timing and other details of the market analysis is available on the website of the FCA.
This is an automatic translation of the press release.
