Globally, AI investments have increased significantly in the last few decades. It is actually the largest form of investment in the emerging market sector. While the UK's investment is lower than that of the United States, it is slightly better than the European Union. The United States is well-known for its risk-taking and for investing heavily in AI. The US's AI startups have disrupted the traditional business model and have a strong presence in the AI sector. But the UK might miss out on the wider economic benefits of AI business expansion.
Computer software is the UK's most capitalised intangible asset. Although this is the largest form, it only represents a small proportion of all investment. Image processing, natural-language processing, and AI-related technology are the most in demand. It's a smart move for companies to invest into AI-related infrastructures. This could allow companies to make better use their human capital. These cost savings can be substantial.
Across the world, investment in AI is expected to increase over the next few years. Global corporate investment for AI is estimated at US$68.3 billion by 2020. The United States is leading the world in AI investments, while the European Union follows close behind. China is closing the gap with America. The Chinese government announced that it will make significant breakthroughs on AI by 2025. It also has a clear IP strategy in place for AI and is investing heavily into research and development.
AI is an extremely important technology that has the potential to completely transform the way many industries operate. But, it is not without its challenges. It is crucial for governments to make sure they are prepared. They can aid in AI innovation expansion and solve domestic problems. They can also provide more guidance for businesses to implement AI systems.
The United States has seen record investment in AI start-ups in 2018. It was actually the first year in which the number of AI startups grew faster than any other year. These start-ups develop products and services that solve specific problems. They are often quickly acquired and used by developers or other companies. These start-ups often do not attract enough investment to warrant larger rounds. This is due to the difficulty they have in protecting their inventions.
Large technology companies in the United States offer AI services. Many AI-related R&D activities in the United States are outsourced to multinationals. Businesses also receive investment to create AI systems. These systems use large datasets in order to train models. Businesses should invest in their internal infrastructure. The ease of working remotely has also enabled development teams to be located anywhere.
The UK has a reputation as a place where new technologies can be incubated. However, it is also a small market, and many young companies are looking to exit early. This could be indicative of a global trend in which rapid exits of AI-related companies can be achieved via M&A. It is also important for the UK to improve its regulatory framework to prevent national security risks from developing.