Economic benefits of open foundation models
02.08.2024 - 02:55
This study estimates the core economic benefits of open foundation models for businesses in the US economy. This considers profit uplift, operational efficiencies and cost savings in rent reductions for US businesses having access to open foundation models versus closed foundation models.
Estimating the benefits of open foundation models in AI
To inform the US National Telecommunications and Information Administration consultation on “Dual Use Foundation Artificial Intelligence Models With Widely Available Model Weights”, this study estimates the benefits of a ‘diverse’ generative AI ecosystem, where both open and closed foundation models exist and are available to access, against the counterfactual of a ‘restricted’ ecosystem where only closed foundation models are available.
Open foundation models could support faster adoption of generative AI amongst US businesses and provide an additional $1.5 trillion in benefits for them in 2035
The transparency, competition and innovation supported by open foundation models could accelerate the adoption of generative AI by US businesses in 2035
Open models allow developers to access, deploy, and modify the model… which has played a key role in growing developer activity in generative AI
Open foundation models support transparency, competition and innovation, and are likely to drive higher adoption of generative AI across the US economy.
Open model weights allows researchers and authorities to inspect, test, modify and deploy models independently. US IT professionals recognize the security benefits of open source - 90% of US IT executives believe enterprise open source is as secure or more secure than proprietary software.
As seen with other technologies, open sourcing puts downward pressure on costs and gives businesses greater flexibility and choice. The top reason businesses use open source software is its cost competitiveness.
Publishing model weights enables developers to collaborate on fine tuning and crowdsource better, safer models. The number of third-party variant models publicly released to date is over 70,000.
We modeled likely adoption curves for generative AI across the two scenarios: diverse and restricted.
In a diverse future generative AI ecosystem, there are highly-capable open and closed foundation models (similar to the current state). In this scenario, 88% of US businesses adopt foundation models.
In a restricted future generative AI ecosystem, government regulation or other competitive dynamics results in predominantly closed foundation models. In this scenario, 55% of US businesses adopt Generative AI foundation models.
Read our latest posts
The Australian Health and Medical Research Workforce Audit
The Australian Health and Medical Research Workforce Audit provides a detailed snapshot of Australia’s health and medical research workforce, highlighting its characteristics, career pathways, and challenges. Drawing on desktop research, surveys, and profile analysis, the report reveals that approximately 39,690 researchers work in the field, with 65% in traditional university and institute roles and 33% in private and clinical settings. Although women make up 52% of the workforce, only 25% hold senior positions, indicating a gender gap in leadership. Over 40% of researchers are from overseas, adding diversity and global connections, while Victoria employs the most researchers, with a notable underrepresentation in regional and remote areas. Despite a shared passion for research and societal impact, many researchers face challenges with funding and job security, and in the past five years, over 60% have moved into non-research roles where they continue to contribute as leaders and managers in related fields. This audit provides valuable insights into the strengths and development opportunities within Australia’s health and medical research workforce.
12 Nov, 2024
Beyond the visa cap: Why restricting international students won't solve Australia's housing crisis
Our latest report in partnership with Student Accommodation Council examines the impact that the Government’s proposed international student visa caps will have on Australia’s metropolitan rental markets. The report demonstrates that while visa caps would significantly harm Australia's economy, they would do little to address housing affordability. International students comprise only 6% of Australia's rental market, with 39% living outside the general rental market entirely. The proposed caps would reduce metropolitan rents by just $5 per week while costing the Australian economy $4.1 billion in GDP and 22,000 jobs. Universities would face $600 million in annual revenue losses. As Australia's fourth-largest export, international education contributes $63 billion to the economy and supports 335,000 jobs. Rather than capping student numbers, the report recommends addressing housing affordability through targeted policies, including reducing tax barriers to foreign investment in student housing and developing purpose-built student accommodation (PBSA) specific legislation. These measures would help maintain Australia's competitive edge while addressing housing pressures through increased PBSA supply.
11 Nov, 2024
Australia’s opportunity in the new AI economy
Our latest research collaboration with Microsoft has just been released, highlighting Australia's most promising opportunities in the new global AI economy. This study identifies key areas where Australia can leverage its strengths in AI applications, AI data centres, and data to drive significant economic growth, create new jobs, and enhance our digital resilience.
7 Nov, 2024
How online retail boosts Australian small and medium businesses
Small and medium businesses (SMBs) power Australia's economy, but they haven't reached their full potential. These businesses - defined as having fewer than 200 employees - employ 66 per cent of our workforce and generate 56 per cent of GDP. However, the productivity rate of SMBs, defined as revenue per worker, is 33 per cent lower than large businesses. Mandala research shows that SMBs that adopt online retail channels earn 2.2 times more revenue and are 45 per cent more productive than their offline peers. Nonetheless, only 12 per cent of all SMBs currently use online retail channels. Because SMBs represent such a large share of the economy, even a small increase in productivity would have big impacts. For example, if SMBs were to increase their adoption rate of online retail channels from 12 per cent to 15 per cent, Australia’s GDP would increase by $1.6B, equivalent to $154 per household each year.
31 Oct, 2024