France and Britain are battling it out for Europe’s A.I. crown
U.K. Prime Minister Rishi Sunak and French President Emmanuel Macron.
Kin Cheung | Pool | Getty Images
LONDON — Two countries are jockeying for position as Europe’s capital for artificial intelligence.
Both French President Emmanuel Macron and British Prime Minister Rishi Sunak have made bold statements about AI in recent weeks, as each tries to claim a stake in the highly hyped market.
“I think we are number one [in AI] in continental Europe, and we have to accelerate,” Macron told CNBC’s Karen Tso at France’s annual tech conference Viva Tech on June 18, while Sunak pitched the U.K. as the “geographical home of global AI safety regulation” at the London Tech Week conference on June 12.
AI is seen as revolutionary and therefore of strategic importance to governments around the world.
Hype around the technology has been partly sparked by the viral nature of Microsoft-backed OpenAI’s ChatGPT. It has also been the source of tech tensions between the U.S. and China as countries around the world try to harness the potential of the most critical technologies.
So, who is leading the race to take Europe’s AI crown?
Money matters
At VivaTech in Paris, Macron announced 500 million euros ($562 million) in new funding to create new AI “champions.” This comes on top of previous commitments from the government, including a promise to pump 1.5 billion euros into artificial intelligence before 2022, in an attempt to catch up with the U.S. and Chinese markets.
“We will invest like crazy on training and research,” Macron told CNBC, adding that France is well-positioned in AI due to its access to talent and startups forming around the technology.
In March, the U.K. government pledged £1 billion ($1.3 billion) to supercomputing and AI research, as it looks to become a “science and technology superpower.”
As part of the strategy, the government said it wanted to spend around £900 million on building an “exascale” computer capable of building its own “BritGPT,” which would rival OpenAI’s generative AI chatbot.
However, some officials have criticized the funding pledge, saying it’s not enough to help the U.K. compete with titans like the U.S. and China.
“It sounds great but it’s nowhere near where we need to be,” Sajid Javid, a former government minister in ex-PM Boris Johnson’s cabinet, said in a fireside discussion at London Tech Week.
Policing A.I. abuses
One big difference between the U.K. and France is how each country is opting to regulate artificial intelligence, and the laws already in place that affect the quick-moving technology.
The European Union has its AI Act, which is set to be the first comprehensive set of laws focusing on artificial intelligence in the West. The legislation was approved by lawmakers in the European Parliament in June.
It assesses different applications of AI based on risk — for example, real-time biometric identification and social scoring systems are considered as posing “unacceptable risk,” and are therefore banned under the regulation.
France will be under direct jurisdiction of the AI Act, and it would be “unsurprising” if the relevant French regulator, either the CNIL or a new, AI-specific regulator, took an “aggressive approach” to its enforcement, according to Minesh Tanna, global AI lead at international law firm Simmons & Simmons.
In the U.K., rather than issue AI-specific laws, the government launched a white paper advising various industry regulators on how they should enforce existing rules on their respective sectors. The white paper takes a principles-based approach to regulating AI.
The government has touted the framework as a “flexible” approach to regulation, which Tanna described as more “pro-innovation” than the French method.
“The UK’s approach is driven, in a post-Brexit world, by a desire to encourage AI investment,” he added, which gives the U.K. more “freedom and flexibility to pitch regulation at the appropriate level to encourage investment,” he said in an email to CNBC.
In contrast the EU’s AI Act could make France “less attractive” for investment in artificial intelligence given that it lays down “a burdensome regulatory regime” for AI, Tanna said.
Who will win?
“France definitely has a chance to be the leader in Europe, but it faces stiff competition from Germany and the U.K.,” Anton Dahbura, co-director of the Johns Hopkins Institute for Assured Autonomy, told CNBC via email.
Alexandre Lebrun, CEO of Nabla, an AI “copilot” for doctors, said the U.K. and France are “probably even” when it comes to attractiveness for starting an AI company.
“There’s a good talent pool, strongholds like Google and Facebook AI research centers, and a reasonable local market,” he told CNBC, but he warned that the EU AI Act would make it “impossible” for startups to build AI in the EU.
“If at the same time the U.K. adopts a smarter law, it will definitely win against EU and France,” Lebrun added.
At the same time, London has been the source of a lot of doom and gloom from some corners of the industry, who’ve criticized the country for being an unattractive place for tech entrepreneurs.
Keir Starmer, the leader of the opposition Labour party, told attendees at London Tech Week that a series of political crises in the country has dented investor sentiment on tech generally.
“Many investors say to me we are not investing in the U.K. right now because we don’t see the conditions of certainty politically that we need in order to invest,” Starmer said.
Claire Trachet, CFO of French tech startup YesWeHack, said the U.K. and France both have potential to challenge the dominance of U.S. AI giants — but it’s just as much about collaboration across Europe as it is competition between different hubs.
“It would require a concerted and collective effort of European tech superpowers,” she said. “To truly make a meaningful impact, they must leverage their collective resources, foster collaboration, and invest in nurturing a robust ecosystem.”
“Combining strengths — particularly with Germany’s involvement — could allow them to create a compelling alternative in the next 10-15 years that disrupts the AI landscape, but again, this would require a heavily strategic vision and collaborative approach,” Trachet added.
Technology
Nvidia positioned to weather Trump tariffs, chip demand ‘off the charts,’ says Altimeter’s Gerstner
Altimeter Capital CEO Brad Gerstner said Thursday that he’s moving out of the “bomb shelter” with Nvidia and into a position of safety, expecting that the chipmaker is positioned to withstand President Donald Trump’s widespread tariffs.
“The growth and the demand for GPUs is off the charts,” he told CNBC’s “Fast Money Halftime Report,” referring to Nvidia’s graphics processing units that are powering the artificial intelligence boom. He said investors just need to listen to commentary from OpenAI, Google and Elon Musk.
President Trump announced an expansive and aggressive “reciprocal tariff” policy in a ceremony at the White House on Wednesday. The plan established a 10% baseline tariff, though many countries like China, Vietnam and Taiwan are subject to steeper rates. The announcement sent stocks tumbling on Thursday, with the tech-heavy Nasdaq down more than 5%, headed for its worst day since 2022.
The big reason Nvidia may be better positioned to withstand Trump’s tariff hikes is because semiconductors are on the list of exceptions, which Gerstner called a “wise exception” due to the importance of AI.
Nvidia’s business has exploded since the release of OpenAI’s ChatGPT in 2022, and annual revenue has more than doubled in each of the past two fiscal years. After a massive rally, Nvidia’s stock price has dropped by more than 20% this year and was down almost 7% on Thursday.
Gerstner is concerned about the potential of a recession due to the tariffs, but is relatively bullish on Nvidia, and said the “negative impact from tariffs will be much less than in other areas.”
He said it’s key for the U.S. to stay competitive in AI. And while the company’s chips are designed domestically, they’re manufactured in Taiwan “because they can’t be fabricated in the U.S.” Higher tariffs would punish companies like Meta and Microsoft, he said.
“We’re in a global race in AI,” Gerstner said. “We can’t hamper our ability to win that race.”
Jaque Silva | Nurphoto | Getty Images
YouTube on Thursday announced new video creation tools for Shorts, its short-form video feed that competes against TikTok.
The features come at a time when TikTok, which is owned by Chinese company ByteDance, is at risk of an effective ban in the U.S. if it’s not sold to an American owner by April 5.
Among the new tools is an updated video editor that allows creators to make precise adjustments and edits, a feature that automatically syncs video cuts to the beat of a song and AI stickers.
The creator tools will become available later this spring, said YouTube, which is owned by Google.
Along with the new features, YouTube last week said it was changing the way view counts are tabulated on Shorts. Under the new guidelines, Shorts views will count the number of times the video is played or replayed with no minimum watch time requirement.
Previously, views were only counted if a video was played for a certain number of seconds. This new tabulation method is similar to how views are counted on TikTok and Meta’s Reels, and will likely inflate view counts.
“We got this feedback from creators that this is what they wanted. It’s a way for them to better understand when their Shorts have been seen,” YouTube Chief Product Officer Johanna Voolich said in a YouTube video. “It’s useful for creators who post across multiple platforms.”
WATCH: TikTok is a digital Trojan horse, says Hayman Capital’s Kyle Bass
CEO of Meta and Facebook Mark Zuckerberg, Lauren Sanchez, Amazon founder Jeff Bezos, Google CEO Sundar Pichai, and Tesla and SpaceX CEO Elon Musk attend the inauguration ceremony before Donald Trump is sworn in as the 47th U.S. president in the U.S. Capitol Rotunda in Washington, Jan. 20, 2025.
Saul Loeb | Via Reuters
Technology stocks plummeted Thursday after President Donald Trump’s new tariff policies sparked widespread market panic.
Apple led the declines among the so-called “Magnificent Seven” group, dropping nearly 9%. The iPhone maker makes its devices in China and other Asian countries. The stock is on pace for its steepest drop since 2020.
Other megacaps also felt the pressure. Meta Platforms and Amazon fell more than 7% each, while Nvidia and Tesla slumped more than 5%. Nvidia builds its new chips in Taiwan and relies on Mexico for assembling its artificial intelligence systems. Microsoft and Alphabet both fell about 2%.
Semiconductor stocks also felt the pain, with Marvell Technology, Arm Holdings and Micron Technology falling more than 8% each. Broadcom and Lam Research dropped 6%, while Advanced Micro Devices declined more than 4% Software stocks ServiceNow and Fortinet fell more than 5% each.
The drop in technology stocks came amid a broader market selloff spurred by fears of a global trade war after Trump unveiled a blanket 10% tariff on all imported goods and a range of higher duties targeting specific countries after the bell Wednesday. He said the new tariffs would be a “declaration of economic independence” for the U.S.
Companies and countries worldwide have already begun responding to the wide-sweeping policy, which included a 34% tariff on China stacked on a previous 20% tax, a 46% duty on Vietnam and a 20% levy on imports from the European Union.
China’s Ministry of Commerce urged the U.S. to “immediately cancel” the unilateral tariff measures and said it would take “resolute counter-measures.”
The tariffs come on the heels of a rough quarter for the tech-heavy Nasdaq and the worst period for the index since 2022. Stocks across the board have come under pressure over concerns of a weakening U.S. economy. The Nasdaq Composite dropped nearly 5% on Thursday, bringing its year-to-date loss to 13%.
Trump applauded some megacap technology companies for investing money into the U.S. during his speech, calling attention to Apple’s plan to spend $500 billion over the next four years.
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