Artificial intelligence (AI) is no longer just a technological tool but a powerful force transforming all aspects of life — from medicine and education to politics and the economy. The challenges AI poses to the modern world were the subject of discussion at the "Artificial Intelligence and Society" conference, held from June 30 to July 2 at the Higher School of Economics in Moscow. On July 2, Alexey Ivanov, Director of the BRICS Competition Centre, delivered a report titled “Artificial Intelligence and Competition.”
In a specialized study, experts from the BRICS Centre analyzed the AI value chains and the degree of economic control at each stage — from microchip production to the development of foundational models. The conclusion was unambiguous: at the global level, power concentration in this sector is critically high. In key segments such as lithography and chip design, one or two corporations dominate with market shares exceeding 90%. Notably, in the design of specialized chips, Nvidia controls about 95% of the market. According to Ivanov, this is particularly concerning since these segments are considered the most technologically advanced and crucial for AI development overall.
© HSE University
This situation is unfolding not only globally but also within jurisdictions friendly to Russia, including BRICS countries. Although countries like China are attempting to create alternative solutions, there has been no significant strengthening of the market positions of Chinese or other alternative producers. Even competitive products such as China’s chatbot DeepSeek often rely on illegal imports of Western technologies banned from export.
It is notable that in less high-tech sectors of the Russian economy, sanctions and strict export restrictions from the U.S. and EU have stimulated the growth of Russian companies and even led to the emergence of local monopolies. However, in the AI tech stack, this has not yet occurred — high market concentration remains even within the BRICS framework.
Alexey Ivanov placed special emphasis on the issue of vertical integration — when large tech companies with already strong market positions expand their influence into adjacent segments. A striking example is the partnership between OpenAI and Microsoft, which enables the latter to monopolize key nodes of the value chain, including through control of cloud infrastructure. This partnership allowed Microsoft to revive Bing—once an insignificant search engine, now playing a much larger role in the AI landscape.
This strategy is a typical example of market leverage, where dominance in one market is used to capture another. Ivanov recalled a similar situation in the late 1990s when Microsoft used its position in the operating systems market to promote Internet Explorer, which led to one of the most significant antitrust cases in history.
In the photo: Alexey Ivanov © HSE University
A comparable case was initiated against AT&T, a telecommunications monopoly whose breakup spurred the development of the internet and mobile communications. Similarly, IBM and Intel were once restricted in their vertical integration, which created an opening for Microsoft to enter the market with its DOS.
“These examples illustrate a general cycle of technological development: a technological revolution often leads to the emergence of monopolies, which must be limited to avoid stalling the next stage of progress,”
Ivanov emphasized.
Today, humanity is once again in the midst of a technological revolution, and it is time to seriously consider limiting the influence of today’s Big Tech in the AI sphere. Global regulators are not yet keeping pace with the speed of change but have begun taking initial steps, including investigations into OpenAI and Microsoft. While these measures remain weak and belated, the very fact of rising interest in antitrust issues is encouraging, especially in light of ongoing discussions in BRICS countries, the speaker noted.
One of the most critical systemic errors in AI regulation, according to Ivanov, lies in government subsidies and support programs, which often reinforce the already monopolized environment. The desire to inject resources into the industry, mobilize efforts, and achieve rapid results often ends up intensifying concentration in narrow segments controlled by the largest corporations. In the process, the “value of competitive market dynamism” is overlooked. The BRICS Centre director stressed that it is especially important to preserve and encourage competition in countries that lack their own IT giants. BRICS countries, in particular, could advance an international pro-competition agenda in the AI field.
“If we are talking about the AI industry as a new technological environment developing effectively, it is crucial to give it a market-driven impulse and break the monopolistic link.”
In conclusion, Alexey Ivanov expressed his belief that if competitive dynamism in the new technological environment is not stimulated, it could enter a state of stagnation despite all investments. True progress is only possible in an environment capable of generating alternatives, dismantling dominant positions, and opening the way for new ideas.
