Artificial intelligence (AI) driven virtual assistants such as Alexa (Amazon) are predicted to be ground-breaking new technologies that will transform the way we work and live. However, virtual assistants face an important legal problem with possibly enormous economic consequences. This problem is competition law.
Virtual assistants potentially form a large problem for the economic freedom of consumers around the world. That is because virtual assistants give their owners all kinds of advice. You can ask Alexa what to eat, where to eat, where to do grocery shopping and how to travel. Consequently, virtual assistants have a great influence on the buying behaviour of consumers. This influence would not be a problem when big tech companies would only create technologies. However, the big tech companies are transforming into “Hubs”, as they are spreading their activities to all kinds of market. Amazon for example, is said to plan the opening of 3000 grocery stores.
Watch this:
The combination of the exploitation of a virtual assistant and grocery stores gives Amazon the possibility to recommend the users of Alexa to visit Amazon stores, whenever they ask for a shop. The transferring of market power from one industry (virtual assistants) to another (grocery shopping) is viewed as a breach of antitrust.
Google has been penalized 2,4 billion euro for a similar use of market power. In this antitrust case, Google used Google shopping to recommend its own products at the top of search results, over the products of other companies. In this way, Google used its power in the search engine industry to gain an advantage in the retail industry, which is a violation of competition laws in the EU.
So, what do you think? Will virtual assistants face similar problems as Google shopping? And should antitrust play a big role in the shaping of our digital world?
Sources:
https://www.bloomberg.com/news/articles/2018-09-19/amazon-is-said-to-plan-up-to-3-000-cashierless-stores-by-2021
Thank you for the update on current affairs, very interesting selection of the video. On a side note,
I think shopping experiences with virtual assistant will be profoundly transformative. Of course, like you noted in the post, it plays a role in buying behavior. Perhaps, there is more to it; waiting in the line, picking up products from the shelf and putting it back, these behaviors also allow customers to calculate, to evaulate their decision.
However, with VA, this decision making process is shortened. could be an advantage in encouraging consumption so on and so forth.
Interesting read. Virtual assistants like Alexa/Google Home are growing and will soon become part of daily lives, large volume of data collected by these companies are sold to brokers, advertisers or used to sell their own products/services.
In one of the similar case, company VIZIO that made TV paid a 2.2 million-dollar settlement to the government last year because it had been collecting second-by-second information about what millions of people were watching on TV and then it was selling that information to data brokers and advertisers.
In recent TED talk: “What your smart devices know (and share) about you”, researchers have observed that Alexa devices contacted its cloud servers every 3 minutes (https://youtu.be/POHYyP4EbzE?t=225) regardless of whether you are using it or not.
Unless government adds more strict rules on data privacy, it would be impossible to stop these companies and everyone privacy is at stake.
Virtual assistant has much bigger impact, its not limited to just shopping on google/amazon, but even reading mail/news, using social network or watching TVs.