The European Commission requests feedback on competition in the virtual worlds and generative AI markets

The European Commission (the “Commission”) has on 9 January 2024 launched a call for contributions (the ‘‘Call for Contributions’’) to better understand the virtual worlds and generative AI markets and how the EU’s competition law framework can safeguard innovation and maintain fair competition. The Call for Contributions forms part of the plethora of laws and proposals that the EU has presented in recent years in these fields, alongside the EU’s AI package.

Virtual worlds or as more colloquially known as the ‘metaverse’ refers to a broad category of digital, computer-generated environments which allow users to step into a simulated and immersive virtual environment. Although in their infancy, virtual worlds present a wide range of uses across many different industries. On the other hand, loosely translated, generative AI refers to AI systems which can produce new content such as text or images in response to a user prompt.

Considering the rapid developments happening within virtual worlds and generative AI, the Commission aims to use the Call for Contributions to leverage industry knowledge and understand the way virtual worlds and generative AI function. It will also use this as an opportunity to get a holistic view of potential competition issues which may be present in these markets.

The Commission is seeking feedback and views from various industry participants such as regulatory experts, academia and industry and consumer organisations. The Call for Contributions features a list of questions which involve identifying any potential barriers to entry in these markets as well as pre-emptively reviewing any adaptations which may be necessary to certain EU legal antitrust concepts. In the Commission’s view, notwithstanding that the virtual worlds and generative AI industries may be considered as nascent markets, they may still present certain characteristics such as network effects and market tipping which are generally associated with more traditional markets.

The Call for Contributions will run until 11 March 2024 and the Commission intends to hold a workshop towards the 2nd quarter of 2024 to present the feedback received.