Majority of AI firms working on unhelpful ‘generic’ tools, think tank says
9 April 2025, 00:04
A new report has warned too many firms are focused on developing business efficiency tools, rather than innovations to solve societal problems.
The majority of AI firms operating in the UK are focused on creating generic AI solutions and not purposeful tools which solve a specific problem, a think tank has said.
The Institute for Public Policy Research (IPPR) said it had compiled a database of 3,256 AI firms in the UK and found that 85% do not focus on specific problems or sectors.
The study said too many firms were focused on improving existing business process – for example, creating more efficiency in administration work – rather than on much-needed innovations in areas such improving public health or transport.
The Government is seeking to make AI a key part of its plans to boost economic growth, with the Prime Minister setting out plans in January to harness the technology by, among other things, boosting AI infrastructure to support AI development in the UK and make it an appealing hub for AI businesses around the world.
The AI opportunities action plan pledges to spend billions on making the UK a “global superpower” in AI but the IPPR report said that without further intervention, the current pipeline of AI development lacks clear direction.
It calls for the Government to set up an AI tracking unit to map the types of AI development going on in the UK and to spot where the gaps are, and to steer funding towards problem areas and reward innovation.
Carsten Jung, head of AI at the IPPR, said: “AI progress continues to accelerate at an unprecedented pace and is poised to have a seismic impact on economy and society.
“The Government has said it wants to ‘shape the AI revolution’ but currently much of AI innovation is generic and not focused on solving hard problems.
“Too many companies are focused on generic process improvements rather than coming up with new, better products.
“Too few innovations are aimed at solving big societal problems, such as public health and climate change. This quantity over quality, profit over purpose, speed over substance approach is a huge missed opportunity.
“The dearth of breakthrough AI innovation is partly a result of innovation policy, which has often been unfocused and risk-averse. The Government has many levers to steer the UK AI industry towards fixing hard problems.
“With a push in the right direction, UK companies could lead the world in developing AI that serves the public good—enhancing sustainability, improving healthcare outcomes and boosting opportunity.”
