Golden age of AI? Why Scotland is falling behind in technological race of our times

After the hardball, a flurry of billion-pound investment announcements making up a £31 billion "Tech Prosperity Deal" between the UK Government and a clutch of American tech giants formed a backdrop of good news to accompany US President Donald Trump’s state visit. It’s given every impression that we’re on the cusp of a Great British AI Klondike, but whether the UK is geared up for it is another question.

Jensen Huang, chief executive of the world’s leading chip manufacturer Nvidia (no, not Albert Bartlett), was in no doubt. “We’re here to announce that the UK is going to be an AI superpower,” he told a London press conference as he unveiled a £500 million investment in the London-headquartered cloud computing company NScale.

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On the radar

But that was nothing compared to a £5bn promise from Google parent Alphabet to invest in research and infrastructure over the next two years, with plans to expand its Hertfordshire data centre which only officially opened on Tuesday. There were "profound opportunities in the UK", Google president Ruth Porat told the BBC.

But that too was dwarfed by £22bn from Microsoft, much of which will go towards developing a supercomputer in Essex previously unveiled by the UK Government, and could be invested in the new "AI growth zone" in Northumberland, announced this week, where two data centres are to be established, around the site once earmarked for the abortive Britishvolt battery factory, with a very optimistic goal of creating 5,000 jobs. Middlesborough, where leading modular data centre construction company Durata is based, is also on the government’s radar.

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Scotland got a wee slice of the action too, with the DataVita data centre near Airdrie set to benefit from a £1.5bn boost from New Jersey cloud computing firm CoreWeave. “This collaboration strengthens Scotland’s role as a driving force in the economy,” said DataVita managing director Danny Quinn, who added the country was “well-positioned to become a hub for the UK’s AI ambitions… supporting the UK’s position as a global AI leader”.

But from the collapse of Silicon Glen, the failure of Wang in 1984 and Cadence in 1997, is it a false dawn, or are we really in the vanguard of the lightning-speed AI revolution at the start of a new golden age? The money alone might suggest the latter, until it’s compared with OpenAI's Stargate project – a four-year programme launched in January worth around £370bn, involving Nvidia, Microsoft and others – to build the company new secure AI infrastructure in the US. Last year alone Alphabet, Meta and Microsoft all spent over £25bn on research, and Amazon £50bn.

AI goldrush?

In that context, it would be easy to denigrate the British investments, and the place for expert opinion was Data Centre Dynamics’ (DCD) annual Connect conference in London, bringing together hundreds of delegates from across the UK and Europe with fortuitously magnificent timing. I was there on the recommendation of a business contact with a significant interest in Scottish data centre investments, and for the uninitiated, which was essentially me, it was two days of jargon, acronyms and often impenetrable technical specifications.

But you don’t need to be Bill Gates to understand why this stuff matters. DCD founder George Rockett is evangelical about the need to understand there is now no separate digital economy, just the economy, because all research, development and transaction relies on data processing at speed. Millions of tap-on-tap-off bus and train journeys rely on data systems where once there were ticket offices.

So, which is it? The start of a UK goldrush or waiting for a train that’s left the station? Like Schrödinger's cat, the answer appears to be both dead and alive at once, primarily because no country can afford to be without these centres – “we will never use less data,” David McCall of Virginia-based QTS Data Centers told delegates – and there is plenty of capability here to pick up speed.

Falling behind US and China

But sclerotic regulatory and planning systems, and serious issues with power supply and exorbitant cost mean the UK cannot hope to match the pace set by the US and, particularly, China. Depending on location, it can take two years to acquire permission to build a data centre, and potentially another year to build, by which time the technology will already be out of date. The conference heard it took just four days to build a centre in Dubai.

A recurring theme was the need to explain to both decision-makers and the wider public that the stuff which makes your smart phone work actually needs a physical home, which like any other dwelling needs to be secure in the broadest sense – as Russian cyber-attacks ably illustrate – and should be treated as critical infrastructure like transport and electricity. But reforming the planning system will take years.

As for Scotland, the advantages of a surfeit of wind power – with taxpayers funding millions paid in restraint compensation for operators to switch off turbines because the grid can’t cope – are clear to an industry with an unslakeable thirst for electricity to power the servers and their cooling systems.

And with universities like Edinburgh and Heriot-Watt fully committed to the information revolution, the opportunities are there. But while plenty of countries were represented at DCD-Connect this week, like Lithuania, Poland and Sweden, there was no Scottish presence. From many conversations with exhibitors, and one ex-pat industry veteran who was particularly disparaging about the political effort, the Scottish Government has a big job to get Scotland punching its digital weight, never mind above it.