Self-preferencing in big tech: OpenAI does it like Meta and Google
Meta and Google are threatened with being broken up due to their monopoly position. Meanwhile, OpenAI wants to build a next pillar. Analysis by Eva-Maria Weiß.
Aerial view of San Francisco – north of Silicon Valley. The Salesforce Tower towers prominently over the city.
(Image: Shutterstock/Engel Ching)
Everything once, please. This motto does not only apply in Silicon Valley, but companies there seem particularly interested in being as broadly positioned as possible. Takeovers and investments are commonplace. Services are linked – for their benefit. Companies join forces to secure financing. The fact that OpenAI now also wants to set up a social network is not surprising at first. Only at second glance is the move irritating, as other big tech companies are currently being taken to court for similar behavior.
Meta threatens to spin off WhatsApp and Instagram
Meta acquired WhatsApp and Instagram for many billions of US dollars just as they were about to become big. The US Federal Trade Commission (FTC) believes this was done to eliminate competition. Mark Zuckerberg himself has demonstrably said that it is better to buy than to allow competition. This actually clarifies that competition can be eliminated in this way if it can be taken over. Snap, for example, rejected such an offer from Meta – has not become as big as Instagram, however. You still have to make the acquisitions big and keep them big yourself. This is one of the things Meta is relying on.
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It will be at least until the summer before we know what will happen to Meta. There is a threat of WhatsApp and Instagram being spun off to prevent a monopoly position in the social media sector, particularly regarding communication between friends and family. However, the US government had allowed the acquisitions at the time. The EU Commission also gave the green light. Such a decision to withdraw years later would at least send a signal: beware, no commitment is final.
Google threatens to spin off Chrome
Google has already been judged to have a monopoly position. The exploitation of a dominant market position is particularly problematic here. Google has favored itself. The case concerns the default settings of the search engine on various smartphones, for example, but the entire advertising business and Google's dominance in this area is also the subject of the proceedings. The question is whether Google will at least have to spin off its Chrome browser business.
Google's mainstays are advertising in the search engine as a core source of income, the browser, hardware with smartphones and tablets, the Android operating system and AI products around Gemini. Everything is basically built in-house, there have been no major takeovers like Meta. However, the result here and there is a questionable monopoly position.
OpenAI wants to expand its market power
OpenAI has now become one of the major players in a very short space of time. The business model is based on investments, but the revenues are far from sufficient. According to an analysis by US venture capital firm Andreessen Horowitz, ChatGPT is the most popular and most used AI service. So there are opportunities for future revenue. But OpenAI is not relying on this alone, and is not simply trying to expand its strong service. It already has the potential to attack Google's search engine business. Satya Nadella, CEO of OpenAI's major investor Microsoft, said that they wanted to see Google dance.
What is OpenAI doing instead – is reaching for more. Jony Ive, former chief designer at Apple, is on board. They want to jointly develop hardware that is less annoying than the smartphone. We can probably assume that ChatGPT will be the preferred choice. All AI providers have already said that AI will replace previous operating systems in one form or another. And now OpenAI also wants to build its own social network, into which its AI will be integrated.
While the outcome of the proceedings at Meta and Google is still unknown, it is already clear that this one-size-fits-all approach is not currently favored by the US government or authorities. The EU has also tried, in the form of the DSA and DMA, to create laws to counteract excessive concentration of market power and promote competition. The “good old days of market power” therefore seem to be numbered. And Google doesn't have to dance yet, and Meta has already delivered 700 million people to Meta AI in its services. Neither company has any financial worries – unlike OpenAI.
(emw)
