An unseen consequence of the UK’s mooted £2 billion deal with OpenAI would have been its potentially devastating impact on the country’s own AI startup ecosystem. Awarding a national contract of this scale to a single US giant could have crowded out domestic innovators.
A nationwide rollout of ChatGPT Plus would have made it the default AI tool for millions of Britons. This would have made it incredibly difficult for smaller UK-based AI companies, offering more specialised or alternative services, to gain a foothold in their own home market.
The UK AI trade body has already warned that the government’s focus is too narrow and fixated on Big Tech. A deal of this nature would have been their worst fear realised, representing a massive market distortion created by public funds.
By not proceeding with the deal, the UK government has, perhaps inadvertently, kept the domestic market more open and competitive. The episode serves as a powerful reminder that while partnering with global leaders is important, it must not come at the cost of stifling the growth of a diverse and sovereign local tech industry.