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Two, seemingly contradictory, stories are told about the impact of artificial intelligence. The first is that the industry will be dominated by a handful of giant tech companies, which boast the data, compute power and expertise to transform our lives. These will make the most money.
The second is that AI is a wildly disruptive technology that is going to kick over the chess board on which the current economy is played, enabling nimbler insurgents to invent new games. The reality is: both stories may be simultaneously true.
The publication this week of the Artificial Intelligence Index Report, a 500-page pulse check of the global industry from Stanford University, provides ammunition for both arguments. But most striking is the current omnipresence of the big US companies — including Google, Meta and Microsoft — in terms of research, investment and AI model development.
Private sector companies have certainly captured many of the smartest AI researchers. In 2011, about 41 per cent of newly minted AI PhD researchers in the US and Canada stayed in academia with the same proportion entering industry. By 2022, only 20 per cent remained in academia with some 70 per cent joining industry.
Those researchers have enabled the US to build 61 of the most notable AI models over the past 20 years, compared with 25 in the EU and the UK combined and 15 in China, according to the report.
But the cost of developing those models has skyrocketed. OpenAI spent $78mn on compute power to train its GPT-4 model while Google spent $191mn on Gemini Ultra, the report estimates. Last year, private-sector AI investment in the US totalled $67.2bn, significantly higher than in the next two biggest countries: China ($7.8bn) and the UK ($3.8bn).
Some people argue that AI will be the new rail tracks, or telecommunication networks, of the 21st-century economy on which everything else will run. If so, the giant US tech companies may be steadily usurping some of the traditional functions of governments, investment firms and legislators in building and running the infrastructure themselves while writing and enforcing the rules.
“The main takeaway is that industry dominates,” says Russell Wald, deputy director of the Stanford Institute for Human-Centered Artificial Intelligence that produced the report. “We need to find a way that the public sector still has a seat at the table.”
But while the US tech giants might produce the most powerful AI models, they cannot control all the ways in which they are applied. On that score, there are vast opportunities for other countries and smaller companies to compete. One of the most intriguing aspects of the Stanford report is how surveys of public perception show that people in emerging economies appear more enthusiastic about the possibilities of AI than those in the developed west.
More than 70 per cent of Indonesian, Thai and Mexican respondents thought that AI would be more beneficial than harmful, according to an Ipsos survey last year. That compares with just 37 per cent in the US and France. A higher proportion of respondents claimed to be active daily users of ChatGPT in Pakistan, Kenya, India and Brazil than in the US or the UK, according to another survey by the Schwartz Reisman Institute.
China has been quick to apply AI to real-world uses, accounting for 61 per cent of global AI patents, compared with 21 per cent in the US. It is also accelerating away from the pack when it comes to industrial robots, installing 21 per cent of the global total.
Demography plays a big role in shaping attitudes. About 90 per cent of the world’s youth live outside the developed west and are keen to engage with the digital economy, says Payal Arora, an Indian-born academic and author of a forthcoming book called From Pessimism to Promise. To many of them, technology looks like opportunity.
“Pessimism is the privilege of those who can afford to live in despair,” Arora told the Minderoo Centre for Technology and Democracy conference in Cambridge, in the UK, this week. “We need to burst the pessimism bubble.”
As others at the conference responded, the dominance of US AI companies risks creating new forms of techno-feudalism or data colonialism, as happened with social media. Emerging economies will be the rule-takers, not rule-makers, in this new world order and further stripped of sovereignty. But some think that only reflects current reality. AI may give them a chance to rewrite the script.