Big Tech Has the UK's AI Future in a Headlock, and the Regulator Is Blinking
A new report from the Institute for Public Policy Research has landed with a fairly uncomfortable message for the government: the UK's AI ambitions are being quietly strangled by a handful of American tech giants, and the official watchdog tasked with doing something about it has been defanged.
The IPPR surveyed UK businesses that rely on digital platforms and found 79 percent are worried about Big Tech using its structural dominance to shut out competition. Notably, they ranked this concern above both access to finance and access to talent. That is not a minor gripe about market dynamics. That is businesses saying the infrastructure they depend on is being weaponised against them.
The concentration figures are stark. Google handles over 90 percent of UK internet searches. Microsoft and AWS each command 30 to 40 percent of cloud spending. Microsoft is simultaneously under investigation for its grip on business software. This is not a competitive market by any definition worth using.
The report turns its sharpest criticism on the Competition and Markets Authority. It describes an organisation that has watched senior officials resign or get pushed out, received explicit government pressure to go easy on inward investors (read: American tech companies), and has repeatedly let major investigations end with voluntary commitments rather than anything with actual teeth. The IPPR stops just short of calling the CMA captured, but the implication is hard to miss.
The context here matters. Earlier this year the chair of the CMA's cloud inquiry walked out, citing the agonisingly slow pace of reform and flagging concerns about the agency's independence. This happened shortly after the CMA appointed Doug Gurr, a former senior Amazon executive, as its permanent Chairman. Make of that what you will.
The IPPR wants the government to hand the CMA a clearer and more aggressive mandate. Not just to avoid harm, but to actively create conditions where smaller competitors can grow. It argues the CMA has the tools and the expertise. What it lacks is political cover to use them.
The AI dimension is where things get particularly pointed. The government has staked a meaningful chunk of its economic recovery narrative on AI, as outlined in the AI Opportunities Action Plan. But if the infrastructure underpinning British AI development is owned by overseas giants, the returns from that bet will flow accordingly. Nvidia owns the accelerator market. The hyperscalers control cloud-based AI infrastructure. Microsoft, Google and Amazon have collectively poured over $20 billion into the major AI developers, a level of vertical integration that has already attracted scrutiny from both the CMA and the US Federal Trade Commission.
The IPPR is blunt about the endgame: if AI consolidates into a monopoly or tight oligopoly, the UK ends up as a consumer of someone else's infrastructure with minimal bargaining power and constrained financial returns.
The CMA pushed back when contacted, pointing to strategic market status designations, interventions in Google Search, improvements to mobile ecosystems, and an ongoing investigation into Microsoft's business software and AI products. It insists its work is already opening up opportunities for UK businesses.
That may well be true. But voluntary commitments and incremental interventions are not the same as structurally rebalancing a market dominated by companies with trillion-dollar balance sheets. The IPPR's concern is less about whether the CMA is doing anything, and more about whether what it is doing is remotely proportionate to the problem.
MPs have already told Parliament the UK lacks any coherent strategy for building sovereign capabilities in AI, quantum or space. Experts have suggested European firms are now essentially locked into US cloud infrastructure with little realistic route out. Against that backdrop, the IPPR report reads less like a warning shot and more like a post-mortem written slightly too early.