Competition and IP Policy for AI: Socio-economic Aspects of Innovation

With the publication of its White Paper on Artificial Intelligence—A European Approach to Excellence and Trust, the European Commission has set the stage for regulatory measures to ensure that the diffusion of artificial intelligence (AI) will remain acceptable to market participants, data subjects, and citizens. While recognizing the immense promise that AI holds for economic development, it also points to serious concerns over privacy, accuracy, and equity of automated decision systems, and economic dominance and abuse by platform providers. Intellectual property rights (IPRs) have, from the perspective of competition law and policy, always raised questions about the justification of their exercise in light of economic dominance. The use of AI in traditional business models involving sales and online services, but also new applications such as Internet of Things (IoT), digital twinning and AI of Things (AIoT), otherwise known as Edge Computing, is set to create new forms of dominance that is reinforced by intellectual property in relation to data, software, and trade secrecy. This chapter deals with the intellectual property system and how it may have to be adapted for its continued acceptance as instrument to engender trust in the sustainable development of Fourth Industrial Revolution (4IR) platform technologies, and AI in particular. It is argued that competition policy that recognizes and safeguards consumer interests in AI-dominated markets is key to the smooth functioning of such a platform economy.