How an 'AI freeze' could make big AI companies bigger and hurt smaller firms

Critics say a slowdown of AI development among the largest companies could consolidate the power of frontier labs, just as many others are trying to catch up.

Dan Kitwood/Getty Images


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Dan Kitwood/Getty Images

As Silicon Valley executives call for a slowdown in the development of artificial intelligence, a growing chorus of critics has coalesced around a counterargument: halting the advance of AI will consolidate the power of leading tech companies and kneecap their upstart rivals.

The debate comes as concerns mount in Washington about autonomous AI agents escaping human control and hacking into private companies, just as current and former employees of AI labs issue dire warnings about the dangers of unconstrained AI.

Tapping the brakes on the rapid progress of AI is now something Anthropic CEO Dario Amodei, OpenAI executive Sam Altman, SpaceXAI owner Elon Musk, Google DeepMind’s Demis Hassabis and Microsoft’s Satya Nadella all say they support — though they don’t all share a common vision for accomplishing it.

But smaller AI firms say an AI slowdown will only cement the advantages of the companies at the forefront of the industry, often called frontier labs. And other skeptics say pausing AI development would only work with the cooperation of China, which is far from guaranteed.

“If there’s an industry-wide freeze, then essentially what would happen is whoever has the strongest model today is going to dominate the market share,” said David Bellamy, a research scientist at the United Arab Emirates-backed Institute of Foundation Models, which develops open-source AI tools.

Bellamy estimates that the institute’s AI model is about six months behind OpenAI’s and Anthropic’s most advanced models. He argues that keeping that gap in place will make it hard to compete in a moment when both OpenAI and Anthropic are eyeing blockbuster initial public offerings.

Alvaro Bedoya, former Federal Trade Commission commissioner under President Biden, said a freeze could make the playing field more uneven by putting pressure on smaller companies in ways that could prove ruinous.

“When powerful incumbents lock up the market, the rivals, the upstarts, the scrappy players in that market, can no longer compete on product or quality and service,” Bedoya said. “They are just locked out. And the options available to them are to be bought by the incumbent or to go out of business.”

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