10 Jan 2024

EU Commission Seeks Input on Competition in Virtual Worlds and Generative AI

In a move to learn more about emerging digital markets, the European Commission today launched calls for contributions focused on virtual worlds and generative AI.  These initiatives represent a step by the Commission to understand the competitive dynamics in these rapidly evolving sectors.

The Commission has reached out to various stakeholders, requesting information to gain a comprehensive view of the current state of competition in these innovative fields.  Players from all corners of the industry, including developers, consumers, and academic experts, will indeed share their experiences and insights.

Virtual Worlds: A New Competitive Landscape

Virtual worlds, characterized by their persistent, immersive environments that merge physical and digital realities, are gaining significant traction.  The European market for virtual worlds is estimated to have surpassed €11 billion in 2023.  These platforms are thus becoming more prevalent for activities ranging from socializing to business transactions.  Understanding their competitive dynamics is crucial for ensuring a fair and innovative market.

Generative AI: Transforming Content Creation

Generative AI, known for its ability to create synthetic audio, images, videos, and text in response to user prompts, is another area under scrutiny.  With an estimated €7.2 billion in AI VC investment in the EU in 2023, the impact of these systems is undoubtedly significant.  The Commission hence aims to assess how these technologies influence market dynamics and competition.

Investigating Big Tech and AI Partnerships

In addition, the Commission is examining agreements between large digital market players and generative AI developers.  A significant focus is, therefore, on Microsoft’s investment in OpenAI, assessing whether it falls under the EU Merger Regulation.  This inquiry reflects the Commission’s commitment to monitoring and regulating the evolving digital market landscape.

Next Steps and Global Impact

The deadline for submitting responses is March 11, 2024.  The Commission plans to review all input meticulously.  They may organize a workshop to discuss the findings in the second quarter of 2024.  This initiative is part of a broader strategy by the EU to address the challenges and opportunities posed by these technologies.  This was recently evidenced by the AI Act and Communication on Web 4.0.

The European Commission’s proactive approach in assessing the competitive landscape of virtual worlds and generative AI is crucial in ensuring these technologies develop in a way that promotes innovation, respects fundamental rights, and maintains fair competition.  These contributions will consequently be pivotal in shaping the future of these dynamic sectors in the EU and globally.