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Authors: Garima Ratna
Published by: Amity Research Centers
Published in: 2020

Abstract

Since 2012, several tech giants had invested heavily in Artificial Intelligence (AI) and related technologies. In fact, the year 2018 had witnessed maximum number of acquisitions majorly by tech titans including Facebook, Apple, Microsoft, Google and Amazon.com collectively known as FAMGA companies. These acquisitions involved huge capital. The companies up for acquisition moves were primarily AI start-ups which developed technologies in analytics, healthcare, customer experience, robotics, retail, deep learning, machine learning, etc. Analysts opined that AI was undergoing a market consolidation phase. The general pattern observed was that mostly FAMGA companies were acquiring smaller ones. The reason-AI development was a capital intensive exercise. Moreover, very often the ROI was doubtful. However, the trend of large companies devouring smaller companies was giving rise to a pertinent concern. Were the markets leading to a monopolistic structure in AI? Was there any hidden agenda amongst FAMGA companies? Would a monopolistic structure not lead to logical ethical concerns?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
World/global

About

Abstract

Since 2012, several tech giants had invested heavily in Artificial Intelligence (AI) and related technologies. In fact, the year 2018 had witnessed maximum number of acquisitions majorly by tech titans including Facebook, Apple, Microsoft, Google and Amazon.com collectively known as FAMGA companies. These acquisitions involved huge capital. The companies up for acquisition moves were primarily AI start-ups which developed technologies in analytics, healthcare, customer experience, robotics, retail, deep learning, machine learning, etc. Analysts opined that AI was undergoing a market consolidation phase. The general pattern observed was that mostly FAMGA companies were acquiring smaller ones. The reason-AI development was a capital intensive exercise. Moreover, very often the ROI was doubtful. However, the trend of large companies devouring smaller companies was giving rise to a pertinent concern. Were the markets leading to a monopolistic structure in AI? Was there any hidden agenda amongst FAMGA companies? Would a monopolistic structure not lead to logical ethical concerns?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Settings

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
World/global

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