Australia’s top competition regulator is trying to test a question: Can Microsoft’s AI-integrated search products disrupt a national search and search advertising market that Google currently dominates?

And if Microsoft can do that, is there still a risk of continued market power by a small number of players?

“We are aware of the risk of the exercise of market power by a small number of players. We are also interested to see the way in which there is accessibility to those innovations and those services,” Gina Cass-Gottlieb said during an interview with King & Wood Mallesons partner Luke Woodward at the law firm’s Digital Future Summit.

The Australian Competition and Consumer Commission (ACCC) is conducting a six-month report into recent changes in the search market, driven by generative AI. This study, part of the ACCC’s five-year Digital Platforms Inquiry, is due to be presented to Treasury in September, with the entire inquiry set to wrap up next year.

“The popularisation of Gen AI can lead to consumers feeling greater stickiness to particular providers before they look in order to switch”, Cass-Gottlieb said.