Zoe KleinmanTechnology editor
Major US tech firms have pledged tens of billions of pounds worth of investment in the UK, with the boss of the world’s leading chipmaker, Nvidia, predicting it will make the country an “AI superpower”.
The biggest single investment comes from Microsoft, which has announced a $30bn (£22bn) spending package – its largest ever outside the US.
It is part of a £31bn agreement, dubbed the “Tech Prosperity Deal”, between the UK government and several US tech giants as part of President Donald Trump’s second state visit to the UK.
The deal will see Google, Nvidia and others invest in British-based infrastructure including data centres as well as the creation of a new supercomputer in Essex.
“This is the week that I declare the UK will be an AI superpower,” Nvidia boss Jensen Huang told the BBC.
Meanwhile, Microsoft CEO Satya Nadella said he expected AI investment to drive UK growth and productivity.
“It may happen faster, so our hope is not 10 years but maybe five,” he told the BBC.
“Whenever anyone gets excited about AI, I want to see it ultimately in the economic growth and the GDP growth.”
Prime Minister Sir Keir Starmer said the deal would create highly skilled jobs “putting more money in people’s pockets and ensuring this partnership benefits every corner of the United Kingdom”.
Mr Nadella compared the economic benefits of the meteoric rise of AI with the impact of the personal computer when it became common in the workplace, about ten years after it first started scaling in the 1990s.
But there are also growing mutterings that AI is a very lucrative bubble that is about to burst.
Mr Nadella conceded that “all tech things are about booms and busts and bubbles” and warned that AI should not be “over-hyped or under-hyped”.
He acknowledged that its energy consumption remains “very high” but argued that its potential benefits, especially in the fields of healthcare, public services, and business productivity, were worthwhile.
The campaign group Foxglove has warned that the UK could end up “footing the bill for the colossal amounts of power the giants need”.
The supercomputer, to be built in Loughton, Essex, was already announced by the government in January, but Microsoft has now come on board to the project.
Big tech comes to town
Mr Nadella was speaking exclusively to BBC News as Donald Trump arrived in the UK on a three-day state visit.
The deal seeks to strengthen ties between the countries on AI, quantum computing and nuclear power.
Questions have been asked about what if anything the UK has agreed to give in return.
Technology Secretary Liz Kendall told the BBC the deal did not include guarantees over scrapping a tax for big tech or on copyright for AI companies.
The Digital Services Tax – a 2% levy which raises about £800m a year mainly from US tech companies – was previously said to be part of trade discussions.
But Ms Kendall told the Today programme “that wasn’t part of the partnership” now agreed.
She also said no guarantees were made to AI companies on copyright, a major issue for the UK’s creative sector – which has expressed concerns its work is being used by AI companies without permission.
Meanwhile, a number of tech companies have pledged billions of pounds in investment alongside Microsoft.
Google has promised £5bn for AI research and infrastructure over the next two years.
Nvidia also pledged to develop AI in the UK, which will help fuel innovation, economic growth and jobs, a spokesperson for the chip giant told the BBC.
The company said that along with its partners it will invest up to £11bn in the UK, in what it called the largest AI infrastructure rollout in the country’s history.
AI growth zone in north-east England
The government also said there was “potential for more than 5,000 jobs and billions in private investment” in north-east England, which has been designated as a new “AI growth zone“.
Last year, the government announced a £10bn investment into a data centre to be built near Blyth, Northumberland.
It has now announced another data centre project in Northumberland dubbed Stargate UK from OpenAI, chipmaker Nvidia, semiconductor company Arm and Nscale.
OpenAI boss Sam Altman said Stargate UK would “help accelerate scientific breakthroughs, improve productivity, and drive economic growth”.
However the UK version is a fraction of the firm’s US-based Stargate project, which OpenAI launched in January with a commitment to invest $500bn (£367bn) over the next four years building new AI infrastructure for itself.
The Tony Blair Institute described the news as a “breakthrough moment” but added Britain had some work to do.
Dr Keegan McBride, an emerging tech and geopolitics expert at the institute, said that work included “reforming planning rules, accelerating the delivery of clean energy projects, and building the necessary digital infrastructure” for growth.
Matthew Sinclair, UK director of the Computer & Communications Industry Association, hailed the agreement as “a powerful demonstration of the scale of the AI opportunity for the UK economy”.
But the Conservative Party highlighted that other big international companies such as the pharmaceutical giant Merck have recently cancelled or delayed their UK expansion plans.
Satya Nadella spoke to BBC News shortly before he and other tech leaders, including OpenAI’s Sam Altman and Nvidia’s Jensen Huang, were due to attend the Royal state banquet on Wednesday.
He said he would use Microsoft’s AI tool, Copilot, to help him decide what to wear.
“I was very surprised that there was a very different dress protocol, which I’m really not sure that I’m ready for,” he said.
Additional reporting by Imran Rahman-Jones and Philippa Wain.
