14.4 C
Los Angeles
Saturday, May 25, 2024

Gang war: two arrested in Udupi

A video grab of the alleged...

Why N.Y.C. Hotel Rooms Are So Expensive Right Now

In late 2022, as thousands of...

How a Horror-Loving Librarian Spends His Sundays

The “Scary Stories to Tell in...

‘To the Future’: Saudi Arabia Spends Big to Become an A.I. Superpower

Tech‘To the Future’: Saudi Arabia Spends Big to Become an A.I. Superpower


On a Monday morning last month, tech executives, engineers and sales representatives from Amazon, Google, TikTok and other companies endured a three-hour traffic jam as their cars crawled toward a mammoth conference at an event space in the desert, 50 miles outside Riyadh.

The lure: billions of dollars in Saudi money as the kingdom seeks to build a tech industry to complement its oil dominance.

To bypass the congestion, frustrated eventgoers drove onto the highway shoulder, kicking up plumes of desert sand as they sped past those following traffic rules. A lucky few took advantage of a special freeway exit dedicated to “V.V.I.P.s” — very, very important people.

“To the Future,” a sign read on the approach to the event, called Leap.

More than 200,000 people converged at the conference, including Adam Selipsky, chief executive of Amazon’s cloud computing division, who announced a $5.3 billion investment in Saudi Arabia for data centers and artificial intelligence technology. Arvind Krishna, the chief executive of IBM, spoke of what a government minister called a “lifetime friendship” with the kingdom. Executives from Huawei and dozens of other firms made speeches. More than $10 billion in deals were done there, according to Saudi Arabia’s state press agency.

“This is a great country,” Shou Chew, TikTok’s chief executive, said during the conference, heralding the video app’s growth in the kingdom. “We expect to invest even more.”

Everybody in tech seems to want to make friends with Saudi Arabia right now as the kingdom has trained its sights on becoming a dominant player in A.I. — and is pumping in eye-popping sums to do so.

Saudi Arabia created a $100 billion fund this year to invest in A.I. and other technology. It is in talks with Andreessen Horowitz, the Silicon Valley venture capital firm, and other investors to put an additional $40 billion into A.I. companies. In March, the government said it would invest $1 billion in a Silicon Valley-inspired start-up accelerator to lure A.I. entrepreneurs to the kingdom. The initiatives easily dwarf those of most major nation-state investments, like Britain’s $100 million pledge for the Alan Turing Institute.

The spending blitz stems from a generational effort outlined in 2016 by Crown Prince Mohammed bin Salman and known as “Vision 2030.” Saudi Arabia is racing to diversify its oil-rich economy in areas like tech, tourism, culture and sports — investing a reported $200 million a year for the soccer superstar Cristiano Ronaldo and planning a 100-mile-long mirrored skyscraper in the desert.

For the tech industry, Saudi Arabia has long been a funding spigot. But the kingdom is now redirecting its oil wealth into building a domestic tech industry, requiring international firms to establish roots in there if they want its money.

If Prince Mohammed succeeds, he will place Saudi Arabia in the middle of an escalating global competition among China, the United States and other countries like France that have made breakthroughs in generative A.I. Combined with A.I. efforts by its neighbor, the United Arab Emirates, Saudi Arabia’s plan has the potential to create a new power center in the global tech industry.

“I hereby invite all dreamers, innovators, investors and thinkers to join us, here in the kingdom, to achieve our ambitions together,” Prince Mohammed remarked in a 2020 speech about A.I.

His ambitions are geopolitically delicate as China and the United States seek to carve out spheres of influence over A.I. to shape the future of critical technologies.

In Washington, many worry that the kingdom’s goals and authoritarian leanings could work against U.S. interests — for instance, if Saudi Arabia ends up providing computing power to Chinese researchers and companies. This month, the White House brokered a deal for Microsoft to invest in G42, an A.I. company in the Emirates, which was intended partly to diminish China’s influence.

For China, the Persian Gulf region offers a big market, access to deep-pocketed investors and a chance to wield influence in countries traditionally allied with the United States. China’s form of A.I.-powered surveillance has already been embedded into policing in the region.

Some industry leaders have begun to arrive. Jürgen Schmidhuber, an A.I. pioneer who now heads an A.I. program at Saudi Arabia’s premier research university, King Abdullah University of Science and Technology, recalled the kingdom’s roots centuries ago as a center for science and mathematics.

“It would be lovely to contribute to a new world and resurrect this golden age,” he said. “Yes, it will cost money, but there’s a lot of money in this country.”

The willingness to spend was front and center last month at a gala in Riyadh hosted by the Saudi government, which coincided with the Leap conference. Hollywood klieg lights blazed in the sky above the city as guests arrived in chauffeured Maseratis, Mercedes-Benzes and Porches. Inside a 300,000-square-foot parking garage that had been converted two years ago into one of the world’s largest start-up spaces, attendees mingled, debated opening offices in Riyadh and sipped pomegranate juice and cardamom-flavored coffee.

“There’s something happening here,” said Hilmar Veigar Petursson, the chief executive of CCP Games, the Icelandic company behind the popular game Eve Online, who was at the gala. “I got a very similar sense when I came back from China in 2005.”

Prince Mohammed’s Vision 2030 project, unveiled eight years ago, seems taken from a science-fiction script.

Under the plan, new futuristic cities will be built in the desert along the Red Sea, oriented around tech and digital services. And the kingdom, which has piled billions into tech start-ups like Uber and investment vehicles such as SoftBank’s Vision Fund, would spend more.

That drew Silicon Valley’s attention. When Prince Mohammed visited California in 2018, Sergey Brin, Google’s co-founder, escorted him through a tree-lined path at the company’s campus. Tim Cook, Apple’s chief executive, showed him the company’s products. The prince also traveled to Seattle, where he met with Bill Gates of Microsoft; Satya Nadella, the company’s chief executive; and Jeff Bezos of Amazon.

It was a key moment for Saudi Arabia’s tech ambitions as Prince Mohammed presented himself as a youthful, digitally savvy reformer. But enthusiasm dimmed a few months later when Jamal Khashoggi, a Washington Post columnist and critic of the Saudi royal family, was killed at the Saudi Consulate in Istanbul. Prince Mohammed denied involvement, but the C.I.A. concluded that he had approved the killing.

For a brief period, it was seen as untoward to associate with Saudi Arabia. Business executives canceled visits to the kingdom. But the lure of its money was ultimately too strong.

A.I. development depends on two key things that Saudi Arabia has in abundance: money and energy. The kingdom is pouring oil profits into buying semiconductors, building supercomputers, attracting talent and constructing data centers powered by its plentiful electricity. The bet is that Saudi Arabia will eventually export A.I. computing muscle.

Majid Ali AlShehry, the general manager of studies for the Saudi Data and A.I. Authority, a government agency overseeing A.I. initiatives, said 70 percent of the 96 strategic goals outlined in Vision 2030 involved using data and A.I.

“We see A.I. as one of the main enablers of all sectors,” he said in an interview at the agency’s office in Riyadh, where employees nearby worked on an Arabic chatbot called Allam.

Those goals have permeated the kingdom. Posters for Vision 2030 are visible throughout Riyadh. Young Saudis describe the crown prince as running the kingdom as if it were a start-up. Many tech leaders have parroted the sentiment.

“Saudi has a founder,” Ben Horowitz, a founder of Andreessen Horowitz, said last year at a conference in Miami. “You don’t call him a founder. You call him his royal highness.”

Some question whether Saudi Arabia can become a global tech hub. The kingdom has faced scrutiny for its human rights record, intolerance to homosexuality and brutal heat. But for those in the tech world who descended on Riyadh last month, the concerns seemed secondary to the dizzying amount of deal-making underway.

“They are just pouring money into A.I.,” said Peter Lillian, an engineer at Groq, a U.S. maker of semiconductors that power A.I. systems. Groq is working with Neom, a futuristic city that Saudi Arabia is building in the desert, and Aramco, the state oil giant. “We’re doing so many deals,” he said.

Situated along the Red Sea’s turquoise waters, King Abdullah University of Science and Technology has become a site of the U.S.-Chinese technological showdown.

The university, known as KAUST, is central to Saudi Arabia’s plans to vault to A.I. leadership. Modeled on universities like Caltech, KAUST is the kingdom’s premier scientific research school, bringing in foreign A.I. leaders and providing computing resources to build an epicenter for A.I. research.

To achieve that aim, KAUST has often turned to China to recruit students and professors and to strike research partnerships, alarming American officials. They fear students and professors from Chinese military-linked universities will use KAUST to sidestep U.S. sanctions and boost China in the race for A.I. supremacy, analysts and U.S. officials said.

Of particular concern is the university’s construction of one of the region’s fastest supercomputers, which needs thousands of microchips made by Nvidia, the biggest maker of precious chips that power A.I. systems. The university’s chip order, with an estimated value of more than $100 million, is being held up by a review from the U.S. government, which must provide an export license before the sale can go through.

Both China and the United States want to keep Prince Mohammed close. A.I. ambitions add a new layer of geopolitical significance to a kingdom already key to Middle East policy and global energy supplies. A 2016 visit to Saudi Arabia by Xi Jinping, China’s leader, paved the way for new tech cooperation. Accustomed to top-down industrial policy, Chinese companies have expanded rapidly in the kingdom, forming partnerships with major state-owned companies. The United States has pushed Saudi Arabia to pick a side, but Prince Mohammed seems content to benefit from both nations.

Mr. Schmidhuber, the researcher leading KAUST’s A.I. efforts, has seen the jostling up close. Considered a pioneer of modern A.I. — students in a lab he led included a founder of DeepMind, an innovative A.I. company now owned by Google — he was lured to the desert in 2021.

He was reluctant to move at first, he said, but university officials, via a headhunter, “tried to make it more attractive and even more attractive and even more attractive for me.”

Now Mr. Schmidhuber is awaiting the completion of the supercomputer, Shaheen 3, which is a chance to attract more top talent to the Pesian Gulf and to give researchers access to computing power often reserved for major companies.

“No other university is going to have a similar thing,” he said.

Some in Washington fear the supercomputer may provide researchers from Chinese universities access to cutting-edge computing resources they would not have in China. More than a dozen students and staff members at KAUST are from military-linked Chinese universities known as the Seven Sons of National Defense, according to a review by The New York Times. During the Trump administration, the United States blocked entry to students from those universities over concerns they could take sensitive technologies back to China’s military.

“The United States should quickly move to deny export licenses to any entity if the end user is likely to be a P.R.C. actor affiliated with the People’s Liberation Army,” Representative Mike Gallagher, a Republican from Wisconsin, said in a statement.

A senior White House official, speaking on the condition of anonymity, said that the default U.S. policy was to share technology with Saudi Arabia, a critical ally in the gulf, but that there were national security concerns and risks with A.I.

The Commerce Department declined to comment. China’s Ministry of Foreign Affairs did not respond to faxed questions for comment.

A KAUST spokeswoman said, “We will strictly comply with all U.S. export license terms and conditions for the full life cycle of Shaheen 3.”

Mr. Schmidhuber said the Saudi government was ultimately aligned with the United States. Just as U.S. technology helped create Saudi Arabia’s oil industry, it will play a critical role in A.I. development.

“Nobody wants to jeopardize that,” he said.

Aladin Ben, a German Tunisian A.I. entrepreneur, was in Bali last year when he received an email from a Saudi agency working on A.I. issues. The agency knew his software start-up, Memorality, which designs tools to make it easier for businesses to incorporate A.I., and wanted to work together.

Since then, Mr. Ben, 31, has traveled to Saudi Arabia five times. He is now negotiating with the kingdom on an investment and other partnerships. But his company may need to incorporate in Saudi Arabia to get the full benefit of the government’s offer, which includes buying hundreds of annual subscriptions to his software in a contract worth roughly $800,000 a month.

“If you want a serious deal, you need to be here,” Mr. Ben said in an interview in Riyadh.

Saudi Arabia was once viewed as a source of few-strings-attached cash. Now it has added conditions to its deals, requiring many companies to establish roots in the kingdom to partake in the financial windfall.

That was evident at GAIA, an A.I. start-up accelerator, for which Saudi officials announced $1 billion in funding last month.

Each start-up in the program receives a grant worth about $40,000 in exchange for spending at least three months in Riyadh, along with a potential $100,000 investment. Entrepreneurs are required to register their company in the kingdom and spend 50 percent of their investment in Saudi Arabia. They also receive access to computing power purchased from Amazon and Google free of charge.

About 50 start-ups — including from Taiwan, South Korea, Sweden, Poland and the United States — have gone through GAIA’s program since it started last year.

“We want to attract talent, and we want them to stay,” said Mohammed Almazyad, a program manager for GAIA. “We used to rely heavily on oil, and now we want to diversify.”

One of the biggest enticements for A.I. start-ups is the chance to make the deep-pocketed Saudi government a customer. In one recent meeting, Abdullah Alswaha, a senior minister for communications and information technology, asked GAIA’s start-ups to suggest what they could provide for the Saudi government, including for megacity projects like Neom. Afterward, many of the companies received messages introducing them to state-owned businesses, Mr. Almazyad said.

“I would say this process at the first stages is not organic,” he said. “You don’t find this in Silicon Valley. Eventually the process will be organic.”

Deciding to set up in Riyadh comes with challenges. There’s the heat, reaching more than 110 degrees in the summer, as well as the adjustments of moving to a deeply religious Muslim kingdom. While Saudi Arabia has loosened some restrictions in recent years, freedom of speech remains limited and L.G.B.T.Q. people can face criminal penalties.

Mr. Almazyad, who hopes to eventually study in the United States, said cultural differences could make it hard to recruit international A.I. talent. But he cautioned against underestimating Saudi Arabia’s resolve.

“This is just the beginning,” he said.



Source link

Check out our other content

Check out other tags:

Most Popular Articles