Despite US dominance, Europe can still win with AI, says Skype co-founder.

Niklas Zenström, one of Europe’s most successful tech entrepreneurs and investors, believes the continent’s startups in artificial intelligence can still succeed despite their American rivals’ massive funding.

European startups can thrive by developing applications built on AI platforms managed by US companies such as OpenAI or Google. Zennstrom He told the Financial Times.

“Think about what happened to mobile and the cloud: there are a few cloud providers in the world, they enable thousands and thousands of businesses,” he said in an interview. “Not everyone needs to be a great language model. . . As an app provider, you can create value.

The comments from a leading industry voice come as European policymakers and investors grow concerned that the US is pulling ahead of the region. AI.

Many worry that Europe still risks being left behind by deep-pocketed groups in Silicon Valley in transformative new technology, with major implications for the region’s competitiveness and national security.

Europe’s tech industry has created hundreds of “unicorns” – private companies valued at more than $1 billion – and has narrowed the gap with the US in early-stage funding, despite Europe having more critical (technological) infrastructure,” the Skype co-founder told the FT.

“European companies can build on[AI]platforms from France and the US,” he said.

European entrepreneurs’ confidence in the region’s technological prospects has hit a new low in 2024, according to the European calendar. European Tech State In the year The venture company Atomico, founded by a Swedish entrepreneur in 2006, reports. A recent survey found that 40 percent of founders felt “less optimistic” about the future of European technology than last year.

However, in the year While 2024 will be “very difficult” for start-ups and investors, with capital invested in European tech expected to fall for the third year in a row, Zenström believes pessimism about the region’s prospects is overblown.

“Talking about the problem is (only) a European problem,” he said. There’s a lot of interesting data that shows that we’re actually getting along (with the US), and we’re doing pretty well.

Despite that growth in Europe’s tech industry as a whole, the transatlantic investment gap in AI startups in particular is huge.

A Report Venture firm Asel published in October that US investment will total about $48 billion in 2023 and 2024, more than five times that of Europe and Israel, while funding in the sector will reach about $9 billion.

Much of the US funding is driven by startups developing so-called “foundation” models of expensive and complex AI systems for general-purpose chatbots and media creation services such as OpenAI’s GPT.

Europe has a few startups working on base models, including one based in Paris. Mistral and Germany’s Black Forest Laboratories.

However, US-based OpenAI, Anthropic and xAI have collectively raised tens of billions of dollars more than their European rivals, the big tech groups Microsoft, Google, Amazon and Meta. High investment In their own big language models.

In the year Atomico, which has raised $1.24 billion in new funds by 2024, has backed European AI startups building more specialized models around specific applications, including Corti, a Danish maker of healthcare digital assistants, and Germany’s DeepL, which offers machine translation tools. .

“It’s not just all five LLM companies,” Zenstrom said. There are also many things that come into play in terms of price.

But “the jury is still out” on whether Europe can build competitive general-purpose LMMs in the long term, he admits.

“What you need for AI, you need a lot of money, you need a lot of data and you need distribution. So it’s only natural that big tech companies have a competitive advantage,” Zenstrom said. “The reality is that the rich get richer.”