Previous talks between the tech sector and the music industry ended in a stalemate, and the Conservatives backed away from making any immediate changes earlier this year.
Last month, Feryal Clark, the AI minister, said the Government was seeking a “way forward” before the end of the year.
A consultation is now expected in the coming weeks that one industry source said would lay out “a roadmap to a final decision”.
This has raised fears among the creative industries that Labour is willing to sacrifice Britain’s powerhouse industry for an uncertain AI future.
“Why would you bet against that success, taking a punt on the AI sector that has not proven economic benefits?” says Tom Kiehl, the chief executive of UK Music, an industry body.
Max von Thun, of the Open Markets Institute, says: “Labour seems to have confused having a plan for the digital economy with handing the keys to big tech monopolists.”
AI boosters argue that allowing models to be trained on British intellectual property would turn the country into a global hub for the technology of the future, attracting investment and jobs.
Critics claim such a change would simply allow companies in California to reap all the benefits while hollowing out the UK’s music, TV and publishing industries by empowering AI rivals.
Many in the tech industry worried that a Labour government would have introduced tougher regulations and punitive safety rules.
A 2020 technology strategy, published shortly after Sir Keir secured the Labour leadership, warned of the “accumulation of power and wealth in the hands of a shrinking tech industry elite”.
“I was shocked when Labour became strongly in favour of growth,” Schmidt told the Prime Minister last week. He could equally have swapped the word tech for growth.
Relationship reset
Shortly after the general election, Rachel Reeves invited the UK bosses of companies including Apple, Amazon and Meta to a Downing Street breakfast to discuss “ways in which the tech sector and Government can work together”. At the meeting, officials said they wanted a “reset” of relations with the tech industry.
Labour has promised a data centre building blitz, overriding red tape and local councils that block new digital infrastructure. Big tech views it as crucial for powering their new AI software offerings. The Government is also planning a new Regulatory Innovation Office specifically launched to “reduce the burden of red tape and speed up access to new technologies”.
Perhaps just as important is what has not become policy. Labour has held back on immediately introducing legislation cracking down on the risks of AI technology, insisting any measures will be “highly targeted”. It has also resisted calls to harden the Online Safety Act to block more so-called “legal but harmful” content, despite pressure to take action after August’s far-Right riots.
Sir Keir also told ITV he was against “simply banning phones for under-16s”, an issue seriously considered by officials under Rishi Sunak’s government.
A former public prosecutor and KC, Sir Keir does not come across as a natural technophile, unlike his predecessor. Sunak confidently rubbed shoulders with venture capitalists and looked the part with his Adidas trainers and hoodies.
However, Tory relations with the sector were often fractious. Ministers clashed with Microsoft after the Competition and Markets Authority (CMA) threatened to block a $69bn (£53bn) takeover of Activision – with one senior executive claiming Britain was “closed for business”.
The Conservatives were also critical of the impact of social media on young people and spearheaded the introduction of the Online Safety Act.
And while Sunak organised an AI Safety Summit in 2023 attended by Elon Musk and OpenAI’s Sam Altman, many were let down by the former prime minister’s overly pessimistic view of the technology.
Theo Bertram, a former Labour adviser to Gordon Brown and previously vice president of government relations at TikTok, says: “Industry saw his ‘AI will destroy the world’ speech as doomsterish and eccentric.”
AI potential
By contrast, Labour seems to be borrowing heavily from the Tony Blair Institute (TBI) for its AI ethos. The former Labour prime minister has been unflinchingly optimistic about the prospects of AI for solving all manner of the UK’s problems. His think tank has been funded to the tune of hundreds of millions of pounds by big tech, including donations from Oracle boss Larry Ellison.
The TBI even leaned on ChatGPT, the OpenAI chatbot, to help research a paper that claimed 40pc of tasks performed by public sector workers could be done by AI. It has also claimed that mass AI adoption could save the Government £12bn per year. Last week, Sir Keir repeatedly labelled AI a “game changer” for the UK.
Von Thun, of the Open Markets Institute, says Labour appears to have “wholly bought into big tech firms’ utopian narratives about the transformative potential of AI, despite many continued flaws with the technology”.
Since taking power, Labour has also looked to the tech industry to fill a number of ministerial and advisory roles.
Clare Barclay, Microsoft’s UK chief executive, will head a new industrial strategy advisory council, a sign of better relations after the Activision spat. Within No 10, Labour has added former TikTok policy spinner James Lyons to head up its communications.
Arguably the most notable appointment is Lord Vallance, once an executive at GSK and the former chief scientific adviser during the pandemic.
