(Bloomberg) -- Billionaire Xavier Niel is investing €200 million ($212 million) in artificial intelligence, split between a future research lab to be located in Paris, cloud supercomputing capabilities powered by Nvidia Corp. hardware, and funding for startups.
The effort aims to lure top French AI engineers — who left to work for big tech firms — back to their home country, where they can build AI products to rival the likes of OpenAI, Niel said in an interview.
The race for AI dominance has intensified geopolitical rivalries as countries seek to harness the technology’s potential for economic growth and influence. Policymakers have rushed to intervene to ensure that their countries aren’t sidelined in the process.
“We don’t want our cloud and AI to be based on algorithms or machines localized in other countries,” Niel said. The danger is being dominated by American or Chinese technology “because they have the means,” he said.
The telecom tycoon believes there is still room for disruption coming from Europe in the AI space. “When you get rich and big, you’re slow, and that’s why startups always kill big companies,” he said.
Half of the investment will be allocated to an independent research lab in Paris, run by a nonprofit foundation. Codenamed “Sphere,” it will bring together top AI researchers and will be supported in part by Niel’s telecommunications group Iliad, parent of cloud-computing firm Scaleway, according to people familiar with the plan.
“When you go to any AI lab in the world, you’ll find that there are always researchers from French schools,” such as top universities Polytechnique and ENS, Niel said. “Our challenge is how to make them stay here, or come back if they are abroad.”
Iliad also invested in supercomputing capacity, including purchasing an Nvidia DGX SuperPOD, equipped with 1016 Tensore Core H100 GPUs — high-end graphics cards designed for machine learning and generative AI.
Iliad’s cloud arm Scaleway will use the capabilities, located in a data center in Saint-Ouen-L’Aumône, near Paris, for its customers to train and operate large-language models. Iliad says this is the most powerful supercomputer in Europe for AI research and will rank 15th globally.
Niel is also using some of the €200 million to invest in startups, like Mistral AI and Poolside AI, whose US founders chose to be based in Paris.
Read More: Europe’s AI Startups Look to Capitalize on the Continent’s FOMO
Still, it’s a fraction of the investment US players have attracted. OpenAI raised $10 billion from Microsoft, while Amazon announced on Monday that it will invest as much as $4 billion in OpenAI’s rival Anthropic.
Niel isn’t concerned by the funding gap. OpenAI’s expense comes from paying for the processors needed to run ChatGPT queries, “not so much the research,” he said.
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