As a federal judge considers cleaving Chrome from Google, and a separate federal trial ponders arguments in a case to force Meta Platforms Inc. to divest WhatsApp and Instagram, a large swath of artificial intelligence (AI) vendors just might benefit.
Should the U.S. government succeed in breaking up two of the leading AI players in two long-running cases, AI development and investment could be opened to scores of smaller participants, industry analysts say.
Indeed, antitrust cases against Meta and Google could conceivably strengthen the United States’ position against China in AI — not weaken it — with a more vibrant ecosystem featuring greater competition and renewed innovation, they add.
“Meta and Google don’t drive innovation for AI outside of their walled gardens,” said Esteban Kolsky, chief distiller and board advisor for Constellation Research. “However, if they are forced to break up, it will open the walled garden for innovative and new companies to inject AI models into their new gardens.”
“This would be akin to what happened when then-Facebook allowed third-party developers to put apps in its feed,” he said. “The main decision here would be if they will allow third parties to keep the profile information they create, or not.”
Major developers are likely to prosper from more streamlined and focused innovation after some short-term chaos in the event of government-mandated changes to Google and Meta, according to Ron Westfall, research director of communication networks at The Futurum Group. He compares the scenario to AT&T Inc.’s government-mandated breakup in 1984 that created “Baby Bells,” regional telecom companies that thrived on technology.
Faced with significant alterations to their business operations or restrictions, dominant companies such as Google and Meta could be forced to share vital research data, for example, fomenting democratized development and paving the way for a new generation of AI leaders to bloom rather than be smothered by the giants.
“Forced divestitures will cause democratization of resources and the benefits will be obvious,” Field Chief Technology Officer Ted Sfikas said in an email. “The notion of AI developers prospering makes a lot more sense when accessibility is enhanced. When we break these businesses up, we’ll see innovation spawn innovation. We’ll see natural incentives for partnerships set up, and form a federated LLM (large language models) community where it makes sense to.”
As the AI market stands now, a handful of big companies – Google, Meta, OpenAI, Microsoft, Amazon.com Inc., NVIDIA Corp., to name a few – control computing power, datasets and talent, based on a study by Georgetown University’s Center for Security and Emerging Technology. The same small group of power brokers invest heavily in research and development, the study found. [Large-scale language model training benefits hugely from large-scale investment. Meanwhile, Amazon’s AWS, Google, and Microsoft own more than half of AI infrastructure worldwide.]
Regulatory pressure, conversely, may make Big Tech think twice about investing in R&D, legal experts said, noting a drop in investment by AT&T into Bell Labs after its mandated breakup.
To be true, any actions by the government to temper the monopolistic impulses of Big Tech in AI is essential for the betterment of the wider industry and consumers, say some. “Contrary to Google’s claim that it knows more about national security than the federal government, it would be more dangerous for Google to choke innovation and create a single point of failure,” argues Laurel Kilgour, research manager at the American Economic Liberties Project.
Sfikas also points out that changes to Google and Meta could shift the “new data domination” to AWS and Microsoft because of their “sheer investments in data centers, cloud infrastructure, and talent pools.”
Nonetheless, there are those who see no benefit to major alterations to the business structures of Big Tech.
“Breaking up Google would have major downsides and no upsides,” said Alden Abbott, former general counsel for the Federal Trade Commission and current senior research fellow at the Mercatus Center.
“Some Google competitors could get temporary benefits, but the end result would be a massive loss of economic wealth and related social welfare,” Abbott said. “By undermining innovation, a breakup would destroy dynamic competition. A lose-lose outcome.”
