Artificial Intelligence as a Platform Technology: Strategic Implications of Competing on Top of an AI Platform

Artificial Intelligence is a transformative technology, but there exists considerable uncertainty about its evolution and impact on firms, society, and the economy. The development of Generative Artificial Intelligence and Large Language Models in many ways parallels the structure of other technology platforms and ecosystems. In this chapter, we discuss the development of Artificial Intelligence technologies (particularly Generative Transformer-Based Artificial Intelligence such as Large Language Models) and explore the similarities to platform ecosystems. We then discuss how learnings from research in platforms can apply to Artificial Intelligence and implications for competitive strategies of firms, innovation by firms, and broader implications of these technologies diffusing across the economy.