OpenAI, Apple deal raises questions about enforcement of EU antitrust rules

4 months ago 32

The integration of ChatGPT into Apple’s operating service, iOS, later this year could trigger a revision of the enforcement of the EU’s digital antitrust regulation according to a European Commission spokesperson, speaking on Tuesday (11 June).

ChatGPT builder OpenAI and US iPhone maker Apple announced a partnership on Monday (10 June). Under the agreement, Apple’s operating systems iOS, iPadOS, and macOS will integrate ChatGPT’s language model later this year. Apple’s digital assistant Siri and its writing tools, therefore, will be enhanced by artificial intelligence (AI) capabilities.

Apple’s iOS was designated a core platform service in September 2023 under the EU’s digital antitrust regulation, the Digital Markets Act (DMA), with the service now having to comply with a series of antitrust obligations.

The DMA and its processes are “quite flexible” and “can be updated if needed,” said the Commission’s competition spokesperson Lea Zuber at a press briefing on Tuesday (11 May), when asked by Euractiv.

“If the [core platform] services change,” this can “be reflected in the regulatory obligations”, said Zuber.

But she also pointed out “large language models do not feature on our [Digital Markets Act] list of core platform services.”

Yet, in the DMA’s current application, “ChatGPT and other large language models could be integrated into core platform services, for example, online search engines or virtual assistants,” which are in its list of core services, said Zuber.

The press release from both companies did not specify whether ChatGPT features will also be integrated into Apple’s web browser Safari, also designated a core platform service by the Commission in September 2023.

But Apple’s virtual assistant Siri, in which OpenAI features will be integrated, was not designated a core platform service.

OpenAI did not respond to a request for comment from Euractiv at the time of publication.

It remains unclear if Apple’s iOS antitrust obligations under the DMA would be passed onto ChatGPT.

“Once [ChatGPT]’s service will be integrated [into Apple’s iOS], then we will be able to make our assessment,” said Zuber.

Similar deals have also faced increasing antitrust scrutiny. The Commission is currently considering opening a formal antitrust investigation into the Microsoft-OpenAI partnership worth €12 billion.

In the US, the Federal Trade Commission opened an antitrust probe into the Microsoft-OpenAI partnership, along with other similar deals.

The UK’s competition authority is looking into Amazon’s investment into artificial intelligence startup Anthropic.

Antitrust thresholds under EU law

OpenAI could exceed certain thresholds set by the DMA, for its designation as a gatekeeper, and its ChatGPT service as a core platform service, leading to further scrutiny.

For this to happen the parent company of the core platform service should have a market value of at least €75 billion in the last fiscal year.

The service itself should also have at least 45 million monthly active users, in at least in three EU countries, and more than 10,000 yearly active EU business users.

OpenAI’s market value was over €80 billion ($86 billion), as reported in February by Bloomberg.

Euractiv could not confirm ChatGPT’s monthly active users in the EU. Its CEO Sam Altman said the chatbot counted 100 million weekly active users worldwide in November 2023.

[Edited by Rajnish Singh]

EU Commission to examine Microsoft-OpenAI partnership

The European Commission announced on Tuesday (9 January) that it is examining the nature of the relationship between tech multinational Microsoft and ChatGPT-maker OpenAI, as the recent ousting and reinstatement of the latter’s CEO highlighted the companies’ close connection.