The University of Edinburgh - written evidence (ACT0024): House of Lords Communications and Digital Select Committee inquiry: Scaling Up: AI and creative tech

The University of Edinburgh's submission to the Communications & Digital Committee focuses on the opportunities and challenges faced by SMEs in scaling AI and creative technologies in the UK. Drawing from experiences from the Creative Informatics program and other initiatives within the University, the response highlights the critical role of tailored support and eco-system development for the creative sector.

Economic Potential and Consequences: The UK holds a vital opportunity to lead in the rapidly growing AI market, projected to increase at a CAGR of 36.6% from 2024 to 2030. However, the current near monopolization by major technology firms poses a risk of locking SMEs out of significant market share and may exacerbate social inequalities. Moreover, without crucial legislative protections for creators, the UK risks undermining its globally recognized creative industries. Barriers to Scaling in AI and Creative Technologies: SMEs face distinct challenges, primarily revolving around skills and capacity shortages, financing difficulties, and policy gaps. Creative sectors suffer from a lack of businessoriented training within traditional educational programs which hampers the ability to scale effectively. Financially, there is a noted mismatch between the needs of creative SMEs and the interests of traditional investors. Policy-wise, there is a pressing need for updating R&D tax credits and developing supportive legislation for AI and creative technologies that considers ethical concerns, including data use and IP rights.

Role of Academic Institutions: Universities play a crucial role in nurturing SME growth by providing talent, developing foundational technologies, facilitating networking, and offering commercialization support. Institutions like the University of Edinburgh contribute through initiatives such as the Data Driven Innovation Initiative, the Bayes Centre and programmes like Creative Informatics and CoSTAR by connecting academic advancements with industry needs.

International Lessons: The UK has the potential to adopt models from global best practices such as the cooperative model demonstrated by READ-COOP in the EU, which shows sustainable, community-oriented development and implementation of AI technologies.