Western style capitalism is theoreticaly supposed to promote competition.

In reality, what it ultimately promotes is collusion.

This happens for one very obvious reason --- money. It is more profitable to collude than to compete.

Collusion permeates the economy and everyone just accepts it --- including government.

For example, which is cheaper --- Coke or Pepsi? They effectively cost the same. Special offers, price increases, new product introductions, even flavors (Dr. Pepper and Mr. Pibb) are matched almost exactly or will be in very short order by the dominate suppliers.

Any real compeition is virtually non-existent between the 2 major producers of carbonated sugar water --- and this is just one example of which there are many more. Increasingly over time, any real competition mostly comes from external sources --- like China.

And so it is with AI.

If your theory were true, wouldn’t smaller soda makers be substantially less expensive? There are plenty of them. Why aren’t they cleaning up?

Besides, competition / collusion is a false dichotomy. Would you say carmakers don’t compete because they collude on safety standards?

Yes, companies optimize for profit and that can mean not maximizing R&D spend unless/until market conditions demand it. But R&D is not free. If Coke and Pepsi were throwing AI money at the next ultrasoda, it would be reflected in prices.

All of this is much more complex than just “big companies bad”.