ACT | App Association Releases Survey on The Extent of Transatlantic AI Gap and Impact of UK/EU Regulations

EU-style Tech Regulations Set Back UK and European Startups and SMEs from their US counterparts, New Survey Finds

Today, ACT | The App Association released new survey results detailing how tech policy and regulations on both sides of the Atlantic are impacting startups and small, and medium-sized enterprises (SMEs) in the United States compared to those in the European Union and United Kingdom.

The online survey, conducted by Technometrica, polled a total of over 1,000 SMEs on their opinions and actions surrounding artificial intelligence (AI) adoption and implementation in their businesses. The results provide critical insights into where tech SMEs are using AI, how much companies are investing, the benefits and roadblocks they foresee, and how AI and government policy will shape their growth in coming years.

“We’ve long known that European and British regulations on AI are having a negative impact on adoption and innovation, but now we have data that shows just how stark that impact has become—and the how dire the consequences will be for European economies and commerce” said Morgan Reed, President of ACT | The App Association. “American lawmakers and regulators should take note of the transatlantic AI gap, and how it came to be, in order to keep the U.S. at the forefront of AI innovation and avoid a culture of compliance.”

Key takeaways from the survey include:

• EU SMEs are feeling the regulatory burden. These delays cost EU/UK tech MSMEs an average of $109K–$375K annually per firm, rising to $186K–$528K for directly affected firms. 60% of EU/UK firms said they faced delayed access to frontier AI models, while 58% of EU/UK developers report regulation-driven launch delays, with more than one-third downgrading features.
• US SMEs are adopting AI at a higher rate. 62% of US tech SMEs are actively using AI, compared to only 50% of firms in the EU/UK.
• Integration is also lagging in Europe. 45% of US firms have fully integrated AI into their workflows, compared to just 32% in the EU/UK.
• EU SMEs feel regulation hinders adoption. 76% of respondents say regulations at least moderately affect AI Adoption. About 17% say regulations significantly hinder or completely block adoption.

Investment Outlook is higher in the US. 94% of US tech SMEs plan to increase AI investment, with 27% of micro-firms planning significant increases, double the rate of their European counterparts. Nearly three-quarters (73%) of US users consider it necessary, with 25% calling it “Extremely Important” and 48% “Very Important.” 

View the full survey results and executive summary online here: https://actonline.org/the-hidden-cost-of-ai-regulations-a-survey-of-eu-uk-and-u-s-companies/