A New AI Institute, GenAI’s Cost Savings, and the EU AI Act

Welcome to SV-AI (Silicon Valley - Accelerates Innovation), my newsletter focused on the responsible development and deployment of innovations strengthening California's global competitive edge. Please subscribe to receive upcoming editions. Here, I’ll share tech policy news and leadership insights that you need to know and how technologies, like Artificial Intelligence, are being used IRL. In this edition, I share news about SVLG’s Institute for California AI Policy, GenAI’s trillion dollar cost savings potential, and thoughts on the EU AI Act.  

AI 101

Each week, I like to share a resource or two that I find useful to help readers like you better understand AI.

With the holidays and family time front of mind, my first recommendation is going to be a little different. It’s a Peekaboo Kidz segment called “What is Artificial Intelligence?” on YouTube.  When my children were younger, they really enjoyed this channel and I would recommend watching this short explainer together with any child 10 or younger.  It will no doubt stoke some curiosity for children and hopefully spark a deeper interest in technology for young viewers.

On the opposite end of the spectrum, I highly recommend the work of SVLG’s SVP of Technology & Innovation Peter Leroe-Muñoz, whose expertise sits at the intersection of law, policy, and technology. 

He’s covered how AI will impact various aspects of society, including the criminal justice system, the food industry, elections, and even space exploration. I recommend checking out his insightful articles on LinkedIn here. 

Have a resource you want to share? Drop a link in the comments! 

SVLG Announces California AI Policy Institute 

The new year will kick off a legislative push on AI in Sacramento. State legislators are reportedly working on at least a dozen bills focused on addressing AI’s impact on jobs, elections, privacy, public safety, and more. 

My view is what happens in California won’t stay in California. As we’ve seen before, other state capitols will adopt the market-moving policies and oversight posture established in the Golden State. 

This week, SVLG announced the Institute for California Artificial Intelligence Policy (I-CAP) to build social and political capital for solutions in our state that are informed, balanced, responsible, and effective. I-CAP will educate stakeholders and engage policymakers in Sacramento to help harness AI for societal benefit while addressing its challenges, because understanding AI is critical to strengthening California’s global leadership role. 

Watch the announcement video here. 

GenAI’s Cost Savings Potential  

An interesting new report from the Boston Consulting Group estimates that generative AI can save governments $1.75 trillion per year by 2033.

State agencies across the country are facing tightening budgets. And, the promise of automation and efficiency gains from GenAI is attracting more and more attention. 

Again, California is leading the way. Earlier this month, the California AI Task Force released a report on AI (see my previous newsletter for topline takeaways). Now, the task force is charged with “developing new training materials for state employees, establishing new partnerships with regional institutions and designing new tools for testing generative AI products before they can be widely deployed.” 

We can also expect a government summit in 2024 focused on the impact of AI on California and its workforce. 

Regulation is a Marathon, Not a Sprint 

Under the new EU AI Act, AI is classified under four categories: unacceptable risk, high risk, limited risk, and minimal risk. 

I have a lot of questions about this initial and far-reaching framework. First, overly-broad regulation can be difficult from both a compliance and implementation standpoint for companies.  My concern with any of these approaches is that they slow innovation. Second, I think it’s unclear the methodology by which AI will be classified. And third, the rules don’t take effect until 2025. My thought here is who knows how advanced AI will be a month from now let alone a year from now? It’s hard to believe that regulations set forth today in this vein will be able to keep pace. 

Government leaders in the US will be watching closely to see how this all plays out. My two cents: thoughtful regulation requires a foundation of understanding and partnership with industry. Our leaders should take time to fully consider the role of regulatory postures and work towards future policies that encourage responsible innovation in partnership with our leading innovators. 

Final Thoughts

I want to extend my heartfelt thanks to everyone who has subscribed to my newsletter, engaged with the content, and offered helpful feedback. 

The rise of AI is a seismic shift that will touch almost every aspect of our lives. My goal when launching this was to create a space where we can learn together about what that future might look like. I hope you have found it helpful in your own journey of understanding. 

I’ll be taking the next couple of weeks to spend time with family over the holidays, and I hope you get to do the same. 

I look forward to continuing to grow our community in the new year and wish you all a safe, healthy, and happy holiday season! 

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