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International A.I Research Investment Heats Up

National and corporate investment in A.I research has never been more intense. US$125 million from the Canadian government for their Pan-Canadian Strategy, US$477 million for Digital India, US$400 million from the UK, US$1.8 billion from France, EU$3 billion from Germany, US$2 billion from DARPA alone - US$2.3 billion in AI from VCs last year. And while you may have you guessed it, you probably lowballed China - who has committed a cheeky US$150 billion pledged between 2017 and 2030 - $7 billion spent in 2017, $20 billion anticipated spend by 2020.

An obvious question is, where does Australia sit in this sea of R&D pledges?

The short answer is: paddling in the shallows.

There are some notable mentions: CSIRO announced $35 million focused on geospatial analysis in November last year. But the $29.9 million in the 2018-19 budget allocated for AI-related research - represents a fraction of a fraction of what most of the bigger players are doing.

Now, it’s important to distinguish different types of research investment. You have your basic, applied and translational research funding, then there’s your seed and venture capital. In Australia, a lot of funding for translational research is applied through the R&D Tax Incentive scheme, so without drilling into the financials of every A.I company in the country it’s difficult to make a true assessment of national investment. Yet no matter how you cut it, Australia looks poorly from an A.I R&D spend point of view, and if that continues for much longer it’s not going to end well.

However, just throwing money at a research problem doesn’t fix it. Owning a space in advanced and emerging technological sectors involves creating an ecosystem, building out the personnel, equipment and commercial capabilities, and co-locating them in such a way to enable spillovers. If most of your A.I firms and research groups are in one innovation district, not only do they have absolutely amazing morning coffee chats, they creatively and competitively cooperate. There are many such hubs globally, and building such a space is the centre of Emmanuel Macron’s ambitious plan to make Paris a leading tech hub.

Needless to say, Australia doesn’t have such a space.

That is not to say there isn’t a large amount of domestic work going on in the space. Nor that there isn’t a decently sized practitioner community. It’s just there isn’t a national strategy accompanied by funding anywhere near the ranges of Canada, the UK or France (One can assume we shouldn’t throw ourselves in the US/China Heavyweight Division).

An interesting example of the importance of planning and investment is the case of the semiconductor. Semiconductors have in part obeyed Moore’s Law because of the National Technology Roadmap for Semiconductors. For those of you who haven’t kept a close eye on this space, this roadmap was a US process whereby government, academia and industry sat down and charted a 15-year technological horizon, with regular updates. It was a tripartite convergence of political will, intellectual capital, and industrial translation, similar to the international standard setting 5G is currently experiencing. That’s what’s needed in Australia for A.I. The country has the intellectual capital, and there’s more than enough industries that could engage in translation (mining, banking, agriculture, etc.), but the whole process falls over when it comes to willpower - also known as politics.

Unlike semiconductors, the A.I industrial segment is not defined, and unlike semiconductors, the A.I industrial segment is not one slice of a country’s advanced manufacturing portfolio. A.I cuts across all sectors, and it carries with it a series of connotations that can be deemed politically negative, such as job losses due to automation. Now which right-minded politician is going to try and herd the cats of 20 industries, a handful of universities, a CRC or two, and their own government departments to build out a national strategy? Yet we need that politician now more than ever. Someone who can artfully explain why A.I is good for jobs, why automation will make people’s lives better, why Australia needs to invest in a national roadmap, or risk paying through the nose for digital solutions down the track. This is as much a balance of payments problem as it is one of future national wellbeing. And if it’s not a politician making that argument, at the very least we should have a national Chief Technology Officer doing so, similar to the role of the Australian Chief Scientist or Chief Medical Officer.

Money can make a world of difference in the R&D landscape, but the straight truth is, political will counts for more. If you collect the 100 smartest people and put them in a room with a defined task and a defined budget, they will figure it out. Instead, the world is building chatbots and deep fakes.

The Australian Council of Learned Academies is currently conducting an horizon scanning exercise for A.I. The only problem is, we’re way past horizon scanning territory. If Australia is still at the point of developing an A.I situational awareness, then the gate has fallen off and the horse has bolted. What Australia really needs is a situational awareness coupled with a strategic vision. For that is what strategy is, an understanding that the future is not what you want it to be, and a belief that you must act in a certain way to change the anticipated outcome.

2019 is the year to watch A.I, more than any before. This is primarily due to US-Chinese strategic rivalry. How this now very public rivalry spills over into the technological domain, and A.I research in particular is currently unclear. On February 12 President Trump signed an executive order directing US Federal Agencies to priorities spending on A.I research - the American AI Initiative. It’s an initiative that needs to be understood within this rivalry, just another way to guide US public sector investment in private companies providing A.I solutions, private companies conducting A.I research. It’s a public policy instrument seeking to right the scales between Chinese and US R&D spending on A.I research. As this rivalry heats up, Australia needs to engage with A.I at a national level. That includes policies aimed at building a concentration of Australian companies that can tender for projects resulting from Trump’s announcement.

The reality is, that whoever dominates the A.I landscape will set the rules for the next age of industry. Australia can either compete now, or have the terms of the new business landscape thrust upon us.


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Remi AI is an Artificial Intelligence Research Firm with offices in Sydney and San Francisco. We have delivered inventory and supply chain projects across FMCG, automotive, industrial and corporate supply and more.


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