Big Tech is eating as much data as it can to win in AI, but it’s not ‘winner-take-all’, says CEO

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Big tech companies are consuming as much data as possible to become winners in artificial intelligence, but that’s not necessarily what will define the winners, according to the software giant’s boss. Appian.

Matt Calkins, CEO and co-founder of Appian, said that although the Internet giants like Microsoft, Amazoni Google spend billions on technology, ensuring that success in AI is “not just about money”.

“AI is not a place where money makes more money,” Calkins told CNBC in an interview in his London office on Tuesday.

Calkins was referring to high-profile deals that companies like Microsoft and Amazon are agreeing to with fast-growing and ambitious AI core model makers like OpenAI and Anthropic.

Microsoft has invested a total of $13 billion in OpenAI, a deal that involves Microsoft acquiring a stake in OpenAI and the latter adding its GPT language models to the Redmond-based tech giant’s Azure cloud computing platform , Washington.

Microsoft has struck a similar deal with Mistral, taking a 15 million euro ($16 million) stake in the French AI firm.

The artificial intelligence revolution is here

In the case of OpenAI, Microsoft has a non-voting observer sitting on the company’s board.

This followed a series of shocking events last year that saw OpenAI CEO Sam Altman temporarily ousted, before returning after hundreds of OpenAI employees threatened a coup to join Altman at Microsoft.

Separately, Amazon has invested $4 billion in US AI firm Anthropic, which is behind the Claude AI system. Amazon has a minority stake in Anthropic, but has no seat on the board.

Google has also committed billions in funding to Anthropic, agreeing last year to invest up to $2 billion.

Scrutiny from UK regulators

British regulators are assessing whether the deals agreed by Microsoft and Amazon with foundation AI model startups may constitute effective mergers that could lead to a substantial reduction in competition.

Microsoft denies its deal with OpenAI and Mistral and the hiring of Inflection constituted mergers. Amazon says its partnership with Anthropic constitutes a limited corporate investment, not a merger.

This is a market for the smart. Having enough money to buy, or buy a piece of Anthropic or Mistral or anything like that is impressive. But AI may not be a winner-takes-all market.

For Calkins, whether these deals qualify as mergers that threaten AI competition, there will be room for innovators to thrive.

“If coalitions won the AI ​​race, Google would have won by now,” he said, calling out the US tech giant’s $500 million takeover of British AI lab DeepMind.

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Far from it, Calkins argues, instead, he believes Google lost out to Microsoft early on when it comes to generative AI, which threatens to upend the fabric of Google’s search business.

It follows a blunder that saw Google’s Gemini text-to-image generator produce inaccuracies in historic images that went viral online. Google paused generating images of people to refine the tool. CEO Sundar Pichai called the debacle “unacceptable,” according to an internal memo obtained by CNBC in February.

Google was not immediately available for comment and was contacted by CNBC.

“This is a market for the smart,” Calkins said. “The fact that you have enough money to buy or buy a piece of Anthropic or Mistral or anything like that, that’s impressive. But AI may not be a winner-take-all market.

“There will be different AI algorithms for different purposes, and they’ll be much more or less valuable depending on whether you’ve loaded your data into it and how you’ve loaded it,” he added.

Calkins said the only way for AI systems to become truly intelligent and useful is to be able to understand what we want from them to use in our everyday lives.

“The best AI will be the one you feed your data into, not whoever bought the biggest stack,” he said.

Europe has an “advantage” with regulation

Calkins said the race in AI today has become more about “how much data you can eat” than how smart the AI ​​actually is.

Big tech companies have been “doing everything they can to get as much data as possible,” Calkins said. “But that game was almost over,” he added.

That’s because, in the absence of specific laws to prevent Big Tech from consuming data to avoid privacy violations, these companies were allowed to get the data they needed to train their models.

Calkins said he is disappointed by the lack of progress on AI regulation in the US at the federal level.

Europe has an “advantage” in AI in some ways “because there is an emerging clarity in regulation,” he said on CNBC’s “Squawk Box Europe” on Tuesday.

“In the U.S., it’s not clear, in part because the government has been a little too nice to Big Tech,” he said.

The European Union officially passed its AI Act, the first comprehensive law regulating artificial intelligence, in March.

Calkins said companies need clarity on how they can safely use AI and ensure things like intellectual property protection and users’ personal privacy.

“There’s a natural skepticism in Europe … here we have regulations that push back American Big Tech companies,” Calkins said.

“I would suggest it’s time for that again, with fair use of copyrighted information. We need a clear playing field, we need to understand what data we can use.”

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