Why Europe is lagging in the AI race with the US and China?

Due to the convergence of various digital technologies, we are only at the beginning of a rapid period of transformation of our society and economy. The artificial intelligence (AI) trend that has been hailing as the next industrial revolution, is central to this change that provides major opportunities to improve our lives. Improvements in algorithms, increased processing power, and the exponential growth in the volume and variety of digital data have lead to the recent developments in AI. From machine translations to image recognition, and music generation, many applications of AI have started entering into our daily lives, and are increasingly set up in government, industry, and commerce. The areas of application that will soon be commonplace are connected and autonomous vehicles, and AI-supported medical diagnostics.

There is a strong AI race globally among the US, China, and Europe. With research in the sector, Europe is falling behind in the global AI race overwhelmingly dominated by the US and Asia. The nations are at risk of losing global market share wherein firms fail to develop successful AI products or services and nations that lag in AI adoption will witness diminished global market share in a host of industries, from finance to manufacturing to mining. And nations will put their national security at risk who underinvest in AI R&D, particularly for military applications. Thus, the nations that lag in the AI race can suffer economic harm and weakened national security, thereby diminishing their geopolitical influence.


Artificial Intelligence In Europe

As we all know, artificial intelligence is boosting digital transformation across industries at a global level and hence it has traction not only from the investors but it's also the focus of government initiatives across countries. The potential of Europe to deliver on AI and catch up against the most AI-ready countries such as the United States and emerging leaders like China is large. To boost its competitiveness and ensure trust based on EU values, the European Union is enhancing and facilitating cooperation on AI across the Union. The EU's approach to artificial intelligence and robotics deals with legal, technological, ethical, and socio-economic aspects to boost the EU's research and industrial capacity and to put AI at the service of European citizens and the economy. As per research, the European Union has already invested significant amounts in artificial intelligence, robotics, big data and future, cognitive systems and emerging technologies to help Europe be competitive. But despite all its efforts, the question arises - why artificial intelligence in Europe is lagging?

Artificial Intelligence in China

Much later than the US and Europe, the research efforts in artificial intelligence (AI) was started by China. Earlier contributions by many researchers included logic reasoning, search, automated theorem proving, and knowledge engineering. Later, funding was started by two major research agencies for diverse AI-related research topics, such as hardware and software for intelligence, intelligent application systems, human-computer interaction, machine learning, computer vision, genetic algorithms, neural networks, robotics, and natural language processing. To facilitate the new boom of artificial intelligence in China, the funding was increased tremendously by China's central and local government agencies.

Major technical contributions from the region have been made in computer vision, machine learning, robotics, natural language processing, and more. The progress in AI hardware has enhanced accelerators for deep neural networks. Besides the government-supported academic research, the industry has also been very active in AI exploration. Much of the investment is being put in AI research and related development by China's technical giants. The AI research in industry labs is generally more business-oriented as inventing and developing AI algorithms and systems to optimize their current and new businesses would be their main focus. This boom of artificial intelligence in China has given rise to smaller AI-focused companies. The Chinese government is planning strong support for AI education, research, and applications, recognizing the strong demand for AI. China is ahead of the EU in AI and seems to be quickly reducing the gap between itself and the United States. Compared to the EU and the United States, it has more access to data but is clearly behind both the US and EU in high-quality AI talent. However, a positive feedback loop has been established between industry and academia, which we believe will trigger more essential breakthroughs in AI in the future.

Artificial Intelligence in USA

As per research and report findings, the United States still leads in absolute terms, China comes in second, and the European Union lags further behind despite China's bold AI initiative. The report mainly focused on six categories of metrics - talent, research, development, adoption, data, and hardware to measure AI progress in the economies of China, the European Union, and the United States. It is predicted that this order could change in the coming years, as China is making more rapid progress than the United States or the European Union. The US leads in AI in four of the six categories i.e. talent, research, development, and hardware whereas the Chinese lead in the other two categories i.e. adoption of AI and data. Have you ever wondered why artificial intelligence in USA is blooming day-by-day? As the US has the most AI start-ups, and with its AI start-up ecosystem having received the most private equity and venture capital funding, it leads in the development of both computer chips and traditional semiconductors that are utilized to power AI systems.

US leads in AI Race

To reap the rewards of AI, the United States and China are currently in the best position. These countries have the innovations, infrastructure, and initiative necessary to evolve AI into something with broadly shared benefits. China, in fact, expects to dominate AI globally by 2030. The United States reaped huge economic benefits from the last wave of digital innovation. Although it produces fewer AI scholarly papers than the EU or China, it produces the highest quality papers on average. Hence, considering all the mentioned reasons, the US leads in the AI race.

To become more competitive in the AI economy, China should expand its capacity to teach AI-related subjects at the university level, bring a stronger culture of promoting open data, and encourage research quality over quantity. Meanwhile, the EU should focus on developing policies that incentivize talent to remain in the EU, encourage the development of larger firms that can compete better in a global market, help transfer research successes into business applications, and change regulations to better enable use of the data for AI. And finally, for the United States, it should enable foreign AI talent to immigrate, focus on policies that grow its domestic talent base, and increase incentives for research and development.

The Reason Behind AI Lagging In Europe

The huge potential business benefits of artificial intelligence are currently held back in Europe by a lack of strategic focus. This leads to the consequence that companies risk missing out on the opportunity to use AI to transform their businesses. The manufacturing firms, in particular, see the potential for predictive maintenance leading to smoother operations, greater adaptability of production and higher efficiency arising from automation as the major benefits of AI. Moreover, Europe's entrepreneurs are not that innovative as the American ones, nor as persistent as the Chinese ones. They lack the experience of dealing with such type of software and artificial intelligence problems. Although, Europe has had great companies in telecom and hardware, and a very few good companies in enterprise, but it has always missed a chance to built successful consumer internet companies, huge mobile application companies, and social media companies even.

However, winning and losing will not be determined ultimately by which country gained the most growth through AI, but it will be determined by how the entire global community chooses to leverage AI, as a tool of progress.