Artificial intelligence and competition (Option consommateurs comments)

This is one of the points made by Option consommateurs in its comments submitted as part of the consultation on artificial intelligence (AI) and competition launched by the Competition Bureau.

Retailers can use AI to transmit information to consumers. AI can be used to generate images or videos to advertise their products. Companies can also use AI in their customer service in the form of conversational agents.

As mentioned above, in all cases, the information communicated must not mislead consumers, and companies should take the necessary steps to ensure that representations adequately reflect the products or services they offer to consumers.

Price personalization

AI can also be used to personalize the prices and offers presented to consumers. For example, if a consumer consults online publications about a tourist destination, a travel agency could then present offers and prices, modulated according to the consumer's inferred interest in taking that trip. 

This practice involves the collection and use of personal information. It therefore raises questions about the protection of Canadians' privacy, particularly with regard to valid consent and the legitimate interest in collecting and using personal information for this purpose.

It also limits the ability to adequately compare product prices, since these vary from one consumer to another.

Anti-competitive agreements

Finally, anti-competitive agreements and mergers are two areas where artificial intelligence can have a significant impact on competition in various markets. AI can enable companies to use algorithms to analyze their competitors' offers and adjust their prices accordingly, which can harm competition and prevent consumers from comparing prices properly.

Cases of intentional algorithmic collusion have already been observed, and proving such collusion is proving complex for the authorities, especially when the algorithms make autonomous decisions.

What's more, the growing adoption of AI will play a major role in merger review. Algorithms enhance companies' data-gathering and market forecasting capabilities, which could intensify anti-competitive behavior. 

AI can also change certain merger analysis criteria, making it necessary to modernize these parameters.

Companies can leverage consumer data to segment the market, and algorithmic predictive modeling provides an in-depth understanding of competitors and market conditions.

To prevent such behavior, it is crucial to ensure adequate funding for regulatory authorities, to update merger analysis parameters and to include IT specialists in market research.