Google’s Australia investment could be a big boost for the nation’s A.I. scene

San Francisco, London, Montreal, Paris, and New York have all developed a reputation for being hotbeds of artificial intelligence research over the years.

Sydney and Melbourne, Australia’s two biggest cities, have not. But that could be about to change.

Google announced Monday that it plans to set up a new Google Research Australia lab in Sydney as part of a 1 billion Australian dollar ($729 million) investment in Australia. The lab will research everything from AI to quantum computing.

The move has been welcomed by AI researchers in Australia who told CNBC that there have been limited opportunities for AI gurus in the country over the years.  

Stephen Merity, an Australian AI researcher who now lives in the San Francisco Bay Area, told CNBC that Google should have launched Google Research Australia years ago, adding that there are many well-known luminaries in the field from Australia.

“They almost all had to leave Australia to get opportunities,” he said. “Those who stayed were under-utilized, including those at Google Sydney.”

Google works on a handful of projects in Sydney but the scope of the search giant’s research has been relatively limited compared to the likes of Mountain View, where Google is headquartered, London, Zurich and Tokyo.

Jonathan Kummerfeld, a senior lecturer at the University of Sydney, told CNBC that none of the big technology companies had labs in Australia until very recently.

Amazon opened a lab in Adelaide, while Oracle and IBM have set up AI labs in Melbourne. The likes of Facebook and Twitter have offices in Australia but they don’t have significant teams of AI researchers there.

“The more the industrial research ecosystem in Australia grows, the more other companies will consider opening offices,” said Kummerfeld.

“University departments have been robustly growing over the last decade as enrollments in computer science have gone up, and more faculty means more postdocs and more PhD students, but that’s a relatively small number of permanent jobs in the scheme of things,” he added.

Google’s investment will also be used to expand Google’s cloud computing infrastructure in Australia and fund partnerships with local universities and other organizations.

The investment package — dubbed the “Digital Future Initiative” — is expected to create 6,000 jobs and support an additional 28,000. It was launched at an event attended by Australian Prime Minister Scott Morrison where Google officially opened a new Australia headquarters in Sydney.

“The announcement by Google is a $1 billion vote of confidence in Australia’s digital economy strategy,” Morrison said.

The investment comes after U.S. tech giants were criticized by Australian lawmakers earlier this year for failing to pay local news publishers for content that gets shared on their platforms. In response, Google Australia’s Managing Director Mel Silva threatened to block Google Search in the country.

Australia then became the first country in the world to make it a legal requirement that large technology firms including Google and Facebook, now Meta, pay for news content on their platforms.