WhereWilTomorrow'sA Geniuses GorJuly 2025ByNikolausS.Lang,LeonidＢＯＧ口INSTITUT
The world's best and brightestEven a modest dectine, by US standards, in the inflow of AlAl minds have long been drawn"middle powers"-including the EU,to the US. But as other countries,the UK.Canada, lapan, and some Gulf countries--that arehopingto compete as gobal supliers of the techndogyincreasingly seek to attract thesehosethat bet on researchresearchers while retaining theinompetitive advantage. InopAI research talent-theown home-grown talent, the map.increase as GenAlome commoditized, Inof Al influence could shif.,athe main differentiator,lize on the shift stand to winThe global competition for Al talent is not new, but itsintensity has increased as a result of changing US policiesWhile many CEOs are understandably focused on tarifs and the rising cost of data center expansion in the US, webelieve that changes in immigration policies and publicfunding for R&D mayhave greater long-term effects onglobal competition for Al leadership.WHEREWILLTOMORROW'SAIGENIUSESG0?
Amid Tariff Uncertainty, US TechGiants Forge AheadOnApril1,2025, the USDepartment ofCommerce Despite this uncertainty, recent moves by UStech giantsopened an investigation into the national security,suggest that tarifswl ot undermine the US's gobal leadAs ofFebruary2025.Microsoftsemiconductor manufacturing equipment. The results-zon,and Metaweresetocollectielyspendwhich as of this writing are stil pending-will determine320 billion in capex this year, about 30% morehan they spent in 2024. And following the Trumpfirectly impacting the cost of data center expansion in theUS and the availability of computing power. (Servers2, eamingscallsforthe fist quarter of 2025 showed noaccount for more than half of a US AI data center's totalsigns of the US tech giants scaling back theirAg. In fact, Metaincreased its 2025from betwen S6 bilion and $65 bilion to, billion and $72 billion-a revision thaty prices the all-in tariff effect at 696 to 10% ofREWILTOMORROW'SAIGENIUSESGO?
This is partly a sensible"'wait and see" response ontand leading GenAl developers such aspart of US tech giants. But it's also unsurprising in ligh. and xAl-are also starting with aother. tariff-independent factors.First. there'sthe sheecapitalandcomputingpowermpanies in other countries. (The same ishigher costs of data center expansion for take of what they openly regard as an existentialhreaches40gigawatts.comparedto8the EU asawhole,forexample) USion's repeal of the Biden-era Al Diffusioncoletielyston $145 bilionincash,andamework, US hypersc alers are vir tually unconstrained inn in the last twelve months alone-more than 23imes as much as the three largest non-US GenAlFurthemmore, TSMC's expanding production footprint inthe US could reduce exposure to tariffs for US data centersrelying on leading-edge semiconductors and servers,Against that background, we expect the US to hold its lead...
