Is the European AI act too strict?

If you're in Europe, you may have noticed that certain AI features, such as Apple's on-device AI or ChatGPT's Advanced Voice mode, are either delayed or entirely unavailable. 

This situation is largely influenced by the European Union's regulatory framework, particularly the AI Act. While this legislation aims to protect citizens by enforcing strict privacy and ethical standards, it also has significant implications for AI deployment in the region, affecting businesses and consumers alike.

Examples of AI features not available in Europe

The AI Act

In Europe, many cutting-edge AI features take longer to arrive or don’t come at all. This isn't due to a lack of talent or interest but rather Europe’s regulatory landscape, specifically the AI Act.

The AI Act, proposed by the European Commission, is one of the first global attempts to create comprehensive AI regulations. It emphasises privacy, ethical standards, and ensuring technology aligns with human values. However, this legislation is also why AI developers are cautious about deploying features in Europe.

Is the EU too strict on AI?

While the AI Act aims to protect citizens and ensure ethical AI use, the stringent requirements could stifle innovation. Heavy compliance obligations may push companies to launch their features elsewhere, putting European businesses at a disadvantage.

Finding the right balance is crucial. While transparency, privacy, and ethics are vital for public trust, overly restrictive policies risk hindering progress. European policymakers need to protect users without discouraging innovation, or else Europe could lag behind in the AI race, missing out on important benefits.

Are EU companies at a disadvantage?

Competitors from less regulated markets, like the US or parts of Asia, can roll out AI features sooner, gaining a competitive edge in innovation and user experience. The delays in accessing advanced AI tools hinder EU businesses' global competitiveness. European consumers may also feel left behind compared to those in regions where AI advancements are more readily available.

Recent research from McKinsey shows that Western Europe lags behind the US in AI spending by an average of 61 percent across sectors of similar size and 71 percent for sectors that are two or more times larger in the US than in Western Europe.

The same research implies that Europe holds around 15% share of global AI services market, second behind the US, which leads with over 40%.

While tech players are often halted (or confused) by the AI act, this significant 15% market share still offers a solid foundation for Europe to expand AI services.

EU companies need to keep embracing (generative) AI end-to-end, to keep up and stay competitive.