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Google's Antitrust Challenges and AI Innovation

General Report October 30, 2024
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TABLE OF CONTENTS

  1. Summary
  2. Google's Antitrust Challenges
  3. The Rise of AI Chip Startups
  4. Integrating AI in Traditional Medicine
  5. Impact of AI on Legal Technology
  6. Public Health Diagnostics and Recent Developments
  7. Conclusion

1. Summary

  • Google's significant market dominance, controlling about 90% of the internet search market, has led to intense scrutiny from the U.S. Department of Justice. Accusations of an unlawful monopoly have triggered proposals for a corporate breakup, potentially affecting operations like Chrome and Android. Market analysts and Google argue this could harm innovation, while regulators push for restrictions on Google's financial practices with manufacturers to maintain competitive fairness. Meanwhile, the AI hardware landscape is witnessing a shift with the rise of startups like Cerebras Systems. Competing against giants like NVIDIA, Cerebras is aiming for a substantial IPO to bolster its position, emphasizing technological innovations such as its CS-3 chip, touted to be more efficient and cost-effective. In parallel, AI's application in traditional medicine and legal technology is expanding, with enhancements in healthcare diagnostics and legal service efficiencies, although challenges such as data accuracy remain. Public health diagnostics further underscores the importance of rapid response in managing new health threats, as evidenced by Seegene's development of advanced diagnostic technologies.

2. Google's Antitrust Challenges

  • 2-1. Overview of Google's Market Dominance

  • Google currently commands a significant share of the internet search market, with reports stating that it holds approximately 90% of the market. This dominance is largely characterized by its control over the search engine ecosystem, and it has led to accusations of establishing an illegal monopoly.

  • 2-2. Recent Legal Developments and Government Actions

  • The U.S. Department of Justice has initiated legal actions against Google, citing its excessive monopoly power. In response to a recent federal court ruling that identified Google's practices as monopolistic, the Department of Justice proposed a plan that may include divesting parts of Google's operations, such as the Chrome browser and the Android operating system. This is aimed at restructuring how information is searched on the internet and to limit Google's control over its distribution channels. Furthermore, the Department of Justice has threatened to impose restrictions on Google's financial arrangements with device manufacturers to prevent it from establishing default settings that secure its market share.

  • 2-3. Proposals for Corporate Breakup

  • There are growing calls for a forced corporate breakup of Google to dismantle its monopolistic practices. The Department of Justice's proposal includes behavioral and structural remedies that could prevent Google from maintaining its dominance. This follows the start of an antitrust trial initiated by a collective lawsuit from 38 state attorneys general in 2020, which argued that Google's search engine's dominance violates antitrust laws.

  • 2-4. Reactions from Google and Market Analysts

  • Google has publicly criticized the proposed breakup as being overly radical and detrimental to consumer choice. In response to the legal challenges, Google claims that these actions could stifle innovation and harm the overall market. Meanwhile, market analysts suggest that a breakup is unlikely to materialize in the near term, recalling past instances where the government attempted to force a split of Microsoft without success. Analysts have expressed skepticism regarding the feasibility of breaking up such a significant player in the tech industry.

3. The Rise of AI Chip Startups

  • 3-1. Introduction to Cerebras Systems

  • Cerebras Systems, an American AI chip startup, is making a significant push for its initial public offering (IPO) on the Nasdaq market. The company has identified major competitors in the industry, including NVIDIA, AMD, Intel, Microsoft, and Google.

  • 3-2. Market Position and Competitive Landscape

  • Cerebras Systems is quickly positioning itself in the AI chip market, challenging established players like NVIDIA. According to reports, the company's valuation is expected to be between $7 billion to $8 billion, aiming for up to $1 billion in funding from the IPO. The competition is intensified as other cloud service providers, including Amazon and Google, are also developing their own AI chips.

  • 3-3. Recent IPO Submission and Financial Performance

  • On October 30, 2024, Cerebras submitted its IPO application to the U.S. Securities and Exchange Commission (SEC), proposing the ticker symbol 'CBRS.' In 2024, the company reported revenue of $134.6 million in the first half, showing a significant increase from $8.7 million during the same period last year. However, they also reported a net loss of $66.6 million this year, compared to a net loss of $77.8 million in the first half of 2023.

  • 3-4. Technological Innovations in AI Chips

  • Cerebras has developed innovative AI processors, including its latest CS-3 chip, which claims to be 20 times faster in AI inference speed compared to NVIDIA's Hopper chip, while being more cost-effective. Additionally, Cerebras offers a cloud service based on its computing cluster, providing a comprehensive solution in the AI hardware space.

4. Integrating AI in Traditional Medicine

  • 4-1. Big Data and AI in Healthcare

  • In the era of the Fourth Industrial Revolution, big data and AI have emerged as key technologies driving innovation across various industries, particularly in healthcare. Post the COVID-19 pandemic, the roles of big data and AI have expanded significantly, enhancing intelligent healthcare services related to patient diagnosis, treatment planning, and prognosis prediction. The integration of these technological advancements is opening up new possibilities within traditional medicine, which relies on deeply accumulated experience and knowledge.

  • 4-2. Strategies for Traditional Medicine Integration

  • Despite the advancements in modern data analysis technologies, the integration of these tools into traditional medicine has only recently begun. Current efforts, guided by the 'Traditional Medicine Promotion Law,' have resulted in the formulation of the Fourth Comprehensive Plan for Traditional Medicine Development (2021-2025) by the Ministry of Health and Welfare and related agencies. The Korean Institute of Traditional Medicine has been tasked with building a robust foundation for traditional medicine's development, including establishing a big data hub and implementing AI-driven methodologies aimed at scientific validation and standardization.

  • 4-3. Current and Future Prospects of AI in Health Diagnostics

  • Looking forward, substantial projects are underway to create a traditional medicine big data and AI ecosystem. The aim is to enhance the scientific credibility and objectivity of traditional medicine through data-driven approaches. Notably, three major projects are being prioritized: the establishment of an AI platform for herbal medicine, the creation of a clinical data big data support center for traditional medicine, and the development of necessary data infrastructures. These initiatives include comprehensive management of the entire value chain of traditional medicine, from herb cultivation through production to monitoring and improving patient outcomes.

5. Impact of AI on Legal Technology

  • 5-1. Advancements in Legal Tech through AI

  • The integration of artificial intelligence (AI) within legal technology (legaltech) signifies a transformation that is no longer a distant prospect. Legaltech aims to enhance efficiencies and sophistication in legal services by incorporating technology into legal practices. The advent of AI has facilitated legal contract management, legal research, client management, legal platforms, FAQ services such as chatbots, and legal document drafting across various legal services. AI has been able to expedite repetitive and straightforward tasks in legal documentation, allowing for quicker and more precise handling of legal information, enabling consumers to manage straightforward legal issues with reduced reliance on legal professionals.

  • 5-2. Challenges and Limitations of AI in Legal Services

  • Despite the growth of legaltech through AI, significant challenges exist. Foremost among these are concerns regarding accuracy and fairness. The legal realm is characterized by multiple factors including caselaw and existing laws, making it difficult for AI to yield precise conclusions. Issues such as hallucinations and data bias can result in erroneous answers from AI systems, which can have drastic implications for consumers. Also, AI's inability to tackle complex legal matters often leads to the recommendation that users seek specialist advice instead. Furthermore, the slow transition from analog to digital practice in the legal field presents barriers to acquiring quality training data for AI systems, coupled with copyright and privacy issues.

  • 5-3. Future Directions for Legal Tech Integration

  • To continue the advancement of legaltech, it is essential to address inherent limitations of AI, including issues of hallucination, data bias, and fairness through ongoing research. Developing engineers and data experts familiar with the legal market will support the evolution of these systems. Standardization of legal information and documentation, as well as establishing infrastructure, is necessary for ongoing development. Additionally, resolving concerns surrounding copyright, privacy, and any potential violations of legal practice regulations by AI-driven services should be priority tasks. The establishment of clear regulatory guidelines is crucial for the responsible integration of AI technologies in legal services, fostering a societal consensus on the appropriate roles AI can play in this domain.

6. Public Health Diagnostics and Recent Developments

  • 6-1. Response to Emerging Health Threats

  • Seegene, a global molecular diagnostics total solution company, has swiftly responded to the international public health emergency (PHEIC) declared by the World Health Organization (WHO) regarding the spread of the MPOX virus (formerly known as monkeypox). They announced on September 9, 2024, the addition of a new Research Use Only (RUO) product for detecting the MPOX virus called Novaplex™ MPXV/OPXV plus. This upgraded detection method can distinguish between the MPXV Clade 1 and Clade 2, as well as the Orthopoxvirus (OPXV). Seegene aims to provide these reagents to countries worldwide, responding quickly to the alarming spread of MPOX, which has seen over 25,000 confirmed and suspected cases reported in this year alone, with approximately 650 deaths attributed to the virus.

  • 6-2. Innovations in Diagnostic Technology

  • Seegene has developed two diagnostic reagents, Novaplex™ MPXV/OPXV (RUO) and Novaplex™ HSV-1/2/VZV/MPXV (RUO), to conduct multiplex PCR tests that can simultaneously detect four viruses, including those causing similar symptoms. The reagents are designed to provide reliable results using dual internal controls (Endo IC and Exo IC) in the same tube. This innovation not only meets the WHO recommended minimum requirements but also offers superior capabilities in providing accurate and comprehensive diagnostics for the rapidly spreading MPOX virus, which has characteristics of increased transmissibility and mortality compared to previous variants.

  • 6-3. Collaborative Efforts in Global Health Security

  • Global collaboration in health security is exemplified by Seegene's partnership with Springer Nature in hosting an Open Innovation Program aimed at developing new diagnostic reagents for infectious diseases. This open call for proposals will accept ideas until December, with selected research projects to be announced by August of the following year. Participants are encouraged to leverage Seegene's multiplex PCR technology, which allows for the simultaneous examination of multiple pathogens, thereby enhancing global initiatives to combat infectious diseases and improve diagnostic methods globally.

Conclusion

  • Google LLC faces significant regulatory challenges, primarily from the U.S. Department of Justice, that could alter its role in the tech sector. This potential restructuring aims to foster competition, yet poses risks to innovation. Concurrently, the rise of AI chip startups like Cerebras Systems showcases a dynamic shift in the AI hardware market, as innovations in speed and efficiency push for greater competition. The expanding role of AI in healthcare highlights its transformative potential, particularly in integrating traditional medicine with data analytics, despite challenges around validation and efficacy. Legal technology similarly benefits from AI integration, suggesting improvements in service delivery, though hurdles like data bias and legal compliance persist. Public health diagnostics are rapidly advancing, emphasizing global collaborations to tackle emerging health threats efficiently. Collectively, these developments reflect a critical juncture where technological advancements and regulatory shifts intersect, shaping future opportunities and challenges across these domains. Further alignment between technological innovation and regulatory frameworks will be crucial for harnessing these advancements effectively and ethically across sectors.

Glossary

  • Google LLC [Company]: Google is a multinational technology company specializing in Internet-related services and products, including search engines and online advertising. It faces significant scrutiny over antitrust issues due to its dominant market position, leading to potential regulatory changes.
  • Cerebras Systems [AI Chip Startup]: Cerebras Systems is known for developing AI chips specifically designed for machine learning tasks, aiming to challenge established competitors like NVIDIA. Their recent IPO submission reflects their ambition to secure a strong foothold in the rapidly growing AI chip market.
  • AI in Healthcare [Technology]: The use of artificial intelligence in healthcare is revolutionizing patient care, diagnostics, and treatment methodologies, particularly in traditional medicine where it fosters integration with big data analytics.
  • Legal Technology [Industry]: Legal technology (legaltech) involves the use of technology and software to provide legal services. The integration of AI into legaltech is enhancing efficiency but also poses challenges regarding accuracy and compliance with legal standards.
  • Public Health Diagnostics [Sector]: Public health diagnostics play a crucial role in identifying and managing health threats. Recent advancements in diagnostic technology aim to improve response times to emerging infectious diseases and enhance global health security.

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