Friday Wrap-Up: Lessons from Google’s Former CEO and Europe’s AI Regulation Problem

Nicolai Tangen · Norges Bank Investment Management

Fund won't lay off staff for AI; jury's out on how AI will reshape jobs broadly.

Tangen says his fund has committed not to lay off staff because of AI use. It will instead use AI to make the company more competitive and do more with the same number of people. He cites IKEA, which is reskilling staff rather than cutting jobs, and contrasts it with companies that will lay people off. He concludes that the jury is out and nobody knows how this will play out, calling it one of the biggest societal questions now.

“We have always said that we are not going to lay off people in the fund due to AI use. We rather use it to make the company more competitive, better, we can do more with the same amount of people.”at 1:28

Nicolai Tangen · Norges Bank Investment Management

Men use about 1.6 times more AI tokens than women even excluding power users; a productivity worry.

Tangen says his fund examined token usage by gender, after a Harvard Business School study found women roughly 20% behind in AI usage. Men use two and a half times as many tokens as women. Nine of the ten heaviest users are men, and excluding them men still use about 1.6 times more. He calls this a real worry because AI is a productivity-enhancing tool. He says the gap needs attention across divisions, though his risk department shows women ahead. He also acknowledges token usage is an imperfect measure of outcomes.

“So excluding that still men are using roughly 1.6 times more tokens than women. And I think it's a real worry because it is a productivity enhancing tool that we use.”at 5:27

Nicolai Tangen · Norges Bank Investment Management

Europe lost energy, chips, cloud and models; applications are its remaining AI opportunity.

Tangen says Chinese competition is becoming more forceful, so Europe must become more efficient. He argues Europe has already lost out across the AI stack: energy, chips, cloud and models. Application is therefore where Europe still has a chance. He says Europe suits this because it is highly educated and digital, and that the more efficient it becomes, the better. He ties this to the fund's 25% European allocation, saying he wants European companies to be more competitive so they earn more and the fund gains more.

“And if you look at the stack, we kind of lost out on the energy side, we lost out on chips, the cloud, the models. And so application is where we still could have a possibility.”at 3:15

Nicolai Tangen · Norges Bank Investment Management

Companies must change culture much faster for AI, and that change is very tough.

Responding to Eric Schmidt's point that most companies won't change culture fast enough for AI, Tangen agrees that firms must change much faster than they have. He explains that corporate culture is 'how we do things around here', which is hard to change after doing things one way for a long time. He says cultural change now needs more speed and agility, including a greater ability to change jobs.

“No, you need to change your culture much faster than you've done in the past and it's tough. Culture, you know, corporate culture, the definition of that is just how we do things around here.”at 4:14

Nicolai Tangen · Norges Bank Investment Management

Over-regulating AI in Europe could stop development before it starts; Europe needs AI deployment.

Tangen argues Europe regulates far more than the US, which has more AI than regulation. He calls over-regulating AI in Europe 'potentially very unfortunate' because it can stop development before it starts. He says Europe's most urgent need is implementing AI, and cites Draghi's recent FT article arguing Europe must deploy AI wherever possible to stay competitive against rising Chinese competition. He also cites Norway's early regulation of Meta glasses in public places as an example of heavy regulation.

“I think over regulating AI in Europe is a potentially very unfortunate thing because you can really stop the development before it started and if there is one thing we need in Europe now, it's really implementation of AI.”at 2:42