Hey, Canada: time to replace eh with AI

It’s been a big week for AI, in Canada and abroad.

Let’s start with the weather, a Canadian obsession. Google DeepMind team published the results of a competition between its generative AI model, GenCast, and Europe’s world-class weather forecasting model. GenCast outperformed the European Centre for Medium-Range Weather Forecasts 97.2% of the time, and was able to produce better forecasts in minutes while Europe’s physics-based model took hours.?

Those machine learning models are getting better and faster. (Check out this article in Nature for more).?

To keep pace — or at least not fall further behind — the federal government made some important announcements this week, which provinces, universities, companies and public sector organizations like hospitals all need to build on. Here’s what stands out for me in the?Canadian Sovereign AI Compute Strategy:

1. Up to $700?million to grow Canadian AI champions by leveraging investments in new or expanded data centres through the?AI Compute Challenge;?
2. Up to $1?billion to build transformational public computing infrastructure;
3. Up to $300?million to provide affordable access to compute power for small and medium-sized enterprises?(SMEs) through the AI Compute Access Fund.

Some this is previously announced money put together in a new package — but old or new, it’s critical now to get the investments flowing … and glowing with success stories that can inspire all Canadians to embrace Gen AI.?

We’re falling behind other advanced economies, especially the U.S. A report published this week from my friends at The Dais at Toronto Metropolitan University , indicates AI adoption is still nascent in corporate Canada, and tends to be found largely in large firms and younger firms.

The new strategy can address that. In fact, a critical part of that strategy is a big bet on Cohere , one of Canada’s AI darlings, to build a data centre that will help it take on the world, and to help other Canadian tech companies take on the world. We haven’t seen Canadian governments bet on companies in this way as much as our U.S. and European competitors do.?

That needs to change, and it would be smart for future governments to think about doubling down on an ambitious AI strategy. Spoiler alert: the Trump administration is going to be more AI-focussed than any government other than China has ever been. And if we don’t keep pace, a lot of our AI talent, data and potential across the economy will move south.

Cohere may also help with that with a new focus on small that it explained this week. With all the excitement about large language learning models, which essentially study as much available information as is out there, Cohere is developing AI agents to study contained data sets, which can be cheaper, easier, and more relevant to a narrowly focused business. A classically pragmatic Canadian approach.

Canada’s new AI strategy can also help the middle tier of our economy speed up its use of these powerful tools, just as we’re seeing so many American firms do. Think how much more competitive our mining, health care, retail and transportation sectors — among others — can be with AI.?

There’s no time to lose. KPMG Canada published a good report this week on the finance sector (a Canadian strength) that shows:

• 71% of finance firms are already using AI, with 41% using it significantly in areas such as accounting, financial planning, and treasury management;
• Adoption of GenAI is accelerating, with nearly every company expecting to use it for financial reporting within three years;
• Benefits: enhanced accuracy, reduced human error, faster decision-making;
• Concerns: data security, limited AI skills, high implementation costs;
• Risks: misinformation, IP, data privacy.

It’s been a big year for Gen AI, and we’re just getting going. Get ready for 2025 to be faster, smarter and more practical than anything we’ve seen.

For more insights, check out:

• Our 2023 Disruptors podcast with Cohere co-founder Nick Frosst and VC investor Jordan Jacobs .
• Our “Ready or Not?” study on the readiness of Canadian companies, which we produced with the Creative Destruction Lab .?
• Our recent study on AI’s electricity needs, and what it means for Canada.?

We’ll have lots more in the months ahead on Canada and Gen AI. Sign up for our newsletters and podcast to keep pace!