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back to article Big Tech market power will cause UK to lose AI race, think tank warns

UK businesses say the market power of Big Tech is stifling competition, and will hinder the UK’s ability to reap the benefits from AI, a key part of the government’s plans for economic recovery. A report [PDF] from the Institute for Public Policy Research (IPPR) points out that a handful of companies hold almost total control …

  1. Andy 73

    Incentives matter

    Successive governments have relied on global consultancies that largely originate from America, and we've long committed to consuming their product rather than developing our own.

    This was the prevailing wisdom from the economic miracle of globalisation - why waste your own resources, when someone else is doing it cheaper? It's become embedded in public service thinking, and reinforced by budget constraints. High capex, investing in infrastructure and the delays of implementing our own tools look like a bad choice when we can pay a small monthly fee to a global supplier. OK, so the small monthly fee always increases, and the lock in is real, and we end up paying for an entire product category when individual tools would do the job - but, still, there's a nice guy in a shiny suit ready to smile at any civil servant within 100 miles.

    Private organisations like Nutanix are already looking at the economics of AI and coming to the conclusion that robust independence is key to adoption - open weight models, on prem services rather than reliance on the new shiny from corporate giants that might go pop at any minute. This isn't about committing to the bleeding edge, but about pedantic adoption and ensuring that actual value is delivered rather than just PR friendly high metrics.

    Politically though, this government (and any of the opposition) would not dare walk away from 'our friends in America' - and certainly don't have enough spine to weather the admonishments they'd get if they dared to 'go rogue' with open weight models or independent development. We'll lose this race, because politicians are more concerned with being seen to wear the sponsors shoes than championing the plucky underdog.

    1. elsergiovolador Silver badge

      Re: Incentives matter

      > why waste your own resources, when someone else is doing it cheaper?

      The problem is that "someone else" is not doing it cheaper and likely reason for choosing foreign big consultancies is that the capital is impossible to be audited once it leaves the UK and so the bungs.

      It is all a result of unpunished corruption.

  2. Anonymous Coward
    Anonymous Coward

    What do they suggest we do?

    Can't buy the hardware for years because they bought it all. We can but at astronomical cost.

    Can't invest in education because they'll get poached.

    They have all the money and money talks.

    What can we do?

    I would still invest heavily in education. An educated society can build things. We follow the Chinese model and start working on our own fabs. It'll take us years but if you don't you'll get left behind. We should never have let ARM go but there is no reason we can't do that again. That's where the education comes into it. We used to be great innovators but successive governments have turned us into some poxy services country that produces next to nothing but expensive housing for investment portfolios. We've already lost the AI race unless the bubble pops but even then that makes no difference. We have a 4 year election term for government and that in itself is an issue. What they should be doing is agreeing on all sides a path for the country then if someone puts in a 10 year plan no matter who is in power they have to stick it. Look at the shambles of HS2. Put a 20 year plan in to invest in education, R&D and building fabs then make it impossible to reverse. That's the only way we catch up. Turning schools (academies) and universities into cash cows was the biggest mistake we made and it needs reversing. That's how I see it anyway.

    1. elsergiovolador Silver badge

      Don't forget Scandinavian level of taxes for productive section of the economy and banana republic services in exchange and classist / elitist Civil Service whose favourite pastime is punishing small business, working class and disabled.

    2. James Anderson

      They don’t have all the money .. yet. The UK has one of the largest financial services setups in the world. The trouble is it does not invest but concentrates on various forms of asset stripping in order to pay its bosses massive bonuses.

      The is what Liz Truss called the Crown Jewels of the UK economy and you know you can really trust her judgement.

      So we really need a government that takes a long hard look at these blood suckers and finds some way to actually invest in productive industries.

    3. Bebu sa Ware Silver badge
      Happy

      What can we do?

      Resurrect Oliver Cromwell ?

      Arguably the last truly great English leader. Cancelling Christmas wouldn't be a big deal religiously today and save everyone a few quid. Just have to bring him up to speed so he understands that today these global transnationals are the true instruments of the Devil.

      1. sedregj
        Mushroom

        Re: What can we do?

        "Oliver Cromwell ? ... Arguably the last truly great English leader."

        We shall fight AI on the beaches ...

      2. Anonymous Coward
        Anonymous Coward

        Re: What can we do?

        That’s the thinking lad.

        It’s time to get our roundheads together!

  3. Dan 55 Silver badge
    Flame

    The conditions to thrive in the UK

    - Deliver all UK copyrighted material without compensation to the copyright holders.

    - Electricity infrastructure delivered by the national grid/electricity providers, paid for by everyone else.

    - Water infrastructure delivered by the water company, paid for by everyone else.

    - Road infrastructure delivered by local and central government, paid for by the tax payer.

    - Subsidised telco infrastructure.

    - An extremely generous interpretation of planning permission laws.

    What should really happen:

    - Withdraw money from AI stocks.

    - Dump any and all AI from education, children need to learn how to think, not put the magic prompt into the magic prompt machine.

    - Snarl up Amazon, Google, Microsoft, Oracle, etc... in bureaucracy so they can't get anything done.

    - Wait for this bubble to pop.

    - Carry on relatively shielded from the storm, not having sank money into this nonsense or made AI part of our daily lives.

    And I'm not even trolling.

    1. heyrick Silver badge

      Re: The conditions to thrive in the UK

      Agree. I just hope when this ridiculous bubble bursts, all those who were pushing for AI everywhere will do the honourable thing and resign in disgrace (von der Leyen, you listening?).

      I don't get why so many politicians seem beholden to foreign companies selling snake oil.

  4. amanfromMars 1 Silver badge

    If you got, flaunt it, milk it and bilk it ... and do yourself, and everyone else worthy, a favour.

    A survey conducted for the report found 79 percent of UK businesses relying on digital platforms are concerned about Big Tech using their dominance to limit competition. They rank this as a bigger constraint on their growth than access to finance or talent, according to the IPPR.

    Oh? I don't think so.

    Proper talent, both either with or without access to finance, can easily render dominant Big Tech digital platforms being used to try to limit competition and opposition as if theirs to milk and bilk that which would seek to harm and prevent them from doing their private talented thing ... and in public secretly, so as not to draw undue any unworthy generalised attention to themselves being proof positive of their raw and rare skill.

    Provide even the slightest evidence of being able to achieve that has one drowning in grateful donations and generous grants of flash cash and never ever having to worry about lack of finance for anything or everything ........ or the clumsy threat of the withdrawal of access to finance which the past so oft enthusiastically uses to ruin so many free spirited and renegade rogue and non-compliant antiestablishment lives and dreams.

  5. elsergiovolador Silver badge

    Clown Market Authority

    These clowns should all be sacked. It's just another toilet tax payers money are being flushed into.

  6. Cubbie Roo

    Considering the impossibility of getting ANYTHING done in the UK, the idea that we can A: join the A.I 'race' or B: de-couple from foreign cloud services are both laughable. Incompetence and directionless thinking will remain the order of the day.

    1. Anonymous Coward
      Anonymous Coward

      Lets not let them off so easily

      With the AI race losing is going to pivot to winning very quickly when the bubble goes up.

      As for the cloud, the idea that we can move the important stuff somewhere safer is not ridiculous at all, we would just have to spend the money on expertise, hardware, and infrastructure. We absolutely won't, of course. But that's not because we can't, it's because the people running the place don't want to. It's a little easy to let them off by saying "we can't do this" when what we mean is "a choice has been made on our behalf by very specific people not to do this."

      Of course if we wanted to do that seriously the way forward would be to work with the EU and no British politician is allowed to even think about those two letters in case they find themselves between the St George flags dangling from a lamp post.

      1. Cubbie Roo

        Re: Lets not let them off so easily

        Yup 100% We can't even ween folk off google search so the rest is simply for the birds.

        1. BoHu
          Windows

          Re: Lets not let them off so easily

          ... and speaking of birds, it's heartening to remind ourselves in this of that valorous Canada Goose successfully fighting off the American Bald Eagle last year: a most durable inspiration to all ... imho!

          Hopefully that'll right inspire SiPearl's Rhea-1 to finally come out and strut its stuff in public too, on the shores of the Seine reference server design and racks, enthusing datacenter blokes all over the place to line-up at length and buy near-endlessly vast volumes of the kit, them and schools, all manners of administrations, and whathaveyounots.

          Onwards with steadfast courage now, people! ;)

  7. Evaluator

    Anthropic and OpenAI aren’t profitable. It’s hope stacked on hope that funds them. Some company and/or country can find paths to profit far better than existing foundation model creators have. Focus on applied GenAI technologies beyond chatbots.

  8. phogan99

    In order to get a head of Big Tech or China in AI would require a lot of spending on your own data centers and AI research. If that hasn't been done you can't really be surprised when you get out paced.

    That said, I'd seriously reconsider the cost v. benefit for AI. So far there is a lot of cost and a few benefits... Sometimes the tortoise is the winner in the end.

    You can also put together enough computational power to run open weight models at a fraction of the cost. If the CMA wants to help block Nvidia buying Hugging Face.

  9. aardvarkus

    WHAT race? It's all very well running around in circles like headless AI chickens, but what exactly are we losing out on? Nothing valuable other than making a bunch of tech oligarchs filthy richer.

  10. Anonymous Coward
    Anonymous Coward

    Losing the AI race?

    Sounds like winning to me.

  11. Tron Silver badge

    There is so much wrong with the complaint in the article.

    There is nothing they can do, short of creating British Leyland style, state financed alternatives, where everyone goes on strike if there is a vowel in the month.

    This isn't a big problem with AI as it is an inessential overhyped scam. It is worth losing the AI to prevent the loss of energy, water and bills that come with it.

    GAFA's dominance hasn't been as big as issue as it might have been for business in general, as the orange goblin only weighs in on selected targets.

    There is nothing stopping them from switching to local storage, applications rather than SaaS, LibreOffice and Linux bar their own stupidity.

    Bigger problems in the UK have been the loss of 25% off sterling at Brexit that torpedoed the economy/investment/consumption and loss of access to talent post-Brexit.

    Flogging off ARM to SoftBank was the crowning fail when it came to sovereign ability. That just leaves us with the Pi, which is great but is simply not being sold as a retail alternative. I'm surprised they don't actually hide them from the general public.

    We have great ideas in the UK but no money to follow through as rich Britons expect to make money the lazy way in the money markets, asset stripping, M&A, or bribing politicians.

    And with a censored internet and the OSA, this isn't somewhere to launch new internet services. People would whine about 'harms' when someone did something stupid and lost cash/topped themselves, and the state would steamroller it.

    So despite sovereign tech being trendy, this isn't a big problem in a nation with a lot of bigger problems that nobody wants to talk about, as being honest about the real problems loses you votes to Reform.

  12. frankyunderwood123 Silver badge

    A race we have no chance of winning, even if we win it?

    And a race that gets where, exactly?

    The race that:

    * Slurps up tons of energy to produce 99% slop - more greenhouse gases

    * Slurps up billions of liters of potable water for cooling

    * Sprawls out across the landscape near residential areas, blighting the landscape

    * Makes millions of people redundant

    * Increases the cost of hardware for other uses

    What kind of race is this where everyone is a loser?

    Even big tech is a loser.

    And if these crazy fools do manage to unleash some form of AGI?

    Even if they don't, but end up with something close enough to it that gets out of control?

    What sort of damage could this do to the global financial system?

    What sort of damage could it do to infrastructure?

    What sort of carnage could it unleash if built into weapons systems?

  13. Anonymous Coward
    Anonymous Coward

    Forty Years Of Selling The Family Silver...................

    - Sold the car industry to Tata (India), to Stellantis (France, Italy, USA), to VW (Germany), to BMW (Germany), to SAIC (China)

    - Sold the aircraft industry (and all that's left is Airbus wings and Rolls-Royce)

    - Sold steel making to anyone who would buy.....eventually the Chinese

    - Sold the water services to any foreigner who would buy

    - Sold computer manufacturing (ICL to Fujitsu, INMOS to Netherlands/Switzerland, and so on)

    - Purchased almost any manufactured good from Japan or China

    No....its not "Big Tech Market Power".........it's forty years of selling the family silver..........

    So....I'm wondering....where is there ANY POSSIBLE foundation for SOVEREIGN AI in the UK?

  14. Anonymous Coward
    Anonymous Coward

    Relax, the UK is still a nation of small shop keepers

    Oh, wait….

  15. VoiceOfTruth Silver badge

    Idiots

    >> UK to lose AI race

    The UK is not even in the AI race. These are the same idiots who expounded the mantra: don't build it, buy it in. All the institutional knowledge has been lost.

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