Microchips over megabytes

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Two critical bottlenecks in developing LLMs are the scaling of computation, and the scaling of data. Focusing on these inputs is one way of effectively regulating pioneering foundational models. Data, being distributed and intangible, is hard to control. Compute, on the other hand, tangible and rooted in physical constraints, is not. Compute requires specialised hardware, such as advanced chips, produced through a highly complex and resource-intensive supply chain - a process epitomised by the cutting-edge technologies developed by companies such as ASML .

A recent research paper (co-authored by EV readers Adrian Weller & Diane Coyle) argues that these physical constraints of compute make it an ideal target for AI regulation. This approach could allow governments to:

• Monitor: By tracking computing capacity and its distribution, authorities can keep a watchful eye on AI’s evolving capabilities—and the organisations developing it.
• Allocate: There’s an opportunity to encourage AI developments that promise tangible social benefits, such as technologies to detect deep fakes.
• Enforce: This involves restricting access to essential hardware to specific groups or purposes.

The US has already started to embrace this concept, as evidenced by the AI Executive Order , which mandates oversight of models that exceed a computational power of 10^26 – a threshold nearly reached by Google’s latest Gemini Ultra model . In addition, the recent US semiconductor restrictions on China are a clear example of this enforcement in action.

The implications of surveillance and intervention in computing go far beyond AI. Computing is beginning to be seen as a public infrastructure. In my latest commentary , I highlight the fundamental role of compute in improving social welfare through wider access to information:

There are no energy-poor, information-scarce economies that have good social outcomes for their people.

However, there are risks to centralising the regulation of computing even in well-governed societies. It raises the stakes for corporate capture and may unhelpfully redirect innovation, hamper economic development, or foster a surveillance culture.

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