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If there is any emerging trend in the technology sector, it is likely that Xavier Niel is aware of it. The hacker-turned-entrepreneur owns an extensive telecom empire, sits on the five-member board of ByteDance, the parent company of TikTok, and is a prominent supporter of startups, with investments in companies like the French firm Mistral AI.
Throughout his career, the billionaire has paid close attention to technological advancements. However, he has also observed as Europe has lagged behind the U.S. and China in innovation.
Despite generating some promising startups amidst the wave of generative AI, such as Mistral AI and Aleph Alpha, Europe must do much more to stay competitive in the global AI race.
Niel has expressed that Europe has a real opportunity to demonstrate its potential and creativity in AI. Nevertheless, he warns that if this opportunity is missed, Europe might become irrelevant.
“If Europe doesn’t do this right, it will become a very small continent abandoned for a few generations,” Niel mentioned in a Financial Times interview published in November.
According to Niel, what distinguishes European AI startups are their “values,” such as privacy and transparency. The region is also producing talent focused on engineering and mathematics from its universities, which could give Europe an edge—provided it can act quickly and effectively.
“Sure, the world moves faster now; the resources are greater. But there will always be two clever kids somewhere in the world, working out of a garage, with a technological vision or a new idea,” Niel stated.
The French magnate, with an estimated worth of $8.7 billion according to the Bloomberg Billionaires Index, plays a central role in AI developments. His optimism about Europe’s AI capabilities has prompted him to establish the world’s largest startup incubator, Station F, in Paris. He has also co-invested $300 million in a nonprofit AI research lab alongside Eric Schmidt and Rodolphe Saadé.
Despite this, Niel expresses concerns that if Europe fails to capitalize on the AI boom, it could become “the nicest place in the world for museums,” as he indicated in a conversation with Wired in September. He compared the current AI moment to the time when search engines gained mainstream acceptance, now dominated by American companies like Google and Microsoft Bing.
“If you want to create a search engine now from scratch, you cannot win because you were not there 25 years ago,” Niel explained.
Other experts have similarly expressed concern about Europe falling behind, which could impact the region’s security and defense prospects in comparison to the rest of the world.
Niel advocates that one of Europe’s strengths—their regulatory environment—also leads to the perception that it over-regulates AI, potentially driving competitors out of the market. The European Union has passed a pioneering draft of AI rules, which some regard as innovative, while others find them restrictive.
In an in-depth report on Europe’s competitiveness, former ECB President Mario Draghi emphasized that AI could create new opportunities if implemented properly.
Meanwhile, Christian Klein, CEO of German tech giant SAP, has warned that overregulation could impede the progress of Europe’s startups. Figures like Meta’s Mark Zuckerberg and Spotify’s Daniel Ek issued an open letter in September urging Europe to address its “fragmented and inconsistent” AI regulations.
Companies on the Fortune 500 Europe list, which ranks the region’s largest companies by revenue, are gradually incorporating AI into advanced applications. In the end, Europe’s approach to these challenges could determine its success or failure.
“Put simply, developing, launching, or just using technology is harder in Europe than it is anywhere else in the world. To stay in the global race, the EU needs a new approach: mitigating the risks of new technology while enabling innovation,” Matt Brittin, Google’s EMEA president, commented to Fortune in October.
This story originally appeared on Fortune.com on November 18, 2024, and was featured on Fortune.com.
