Generative Artificial Intelligence (AI) models have recently been garnering the attention of the public and policymakers alike, and how best to regulate foundation models (and AI more generally) is subject of widespread debate.

This report prepared for Meta contributes to the debate regarding AI policy and regulation in two main ways. First, it provides an economic framework through which the benefits associated with open foundation models can be considered. Second, we have conducted interviews with industry participants in Europe, ranging from venture capital and AI innovators to banking firms and retail players. This direct access to European companies that are seeking to implement AI tools means this study provides additional evidence and a fresh perspective for policymakers to consider.

Our research shows that AI has significant potential to accelerate the automation of activities and processes, potentially leading to growth gains in many sectors. Technology start-ups as well as key pillars of the economy—sectors like telecoms, financial services, the public sector, automotive and retail—are likely to benefit from rapid adoption of the many different use cases underpinned by foundation models.

In order to realise that potential, however, it is key that businesses of all sizes are able to unlock the benefits of AI, and harness them to create value to the benefit of businesses and society more broadly. Open foundation models have the potential to unlock significant additional productivity gains, which form the basis of improvements in incomes and welfare.

It is therefore essential for policymakers to clearly define what elements of foundation models are subject to regulation in order not to discourage—and where possible encourage and support—the uptake of AI.