Microsoft is planning to establish a new AI division in London, which happens to be the location of Google's DeepMind. This move is expected to intensify the competition for talent between the two companies. Google, which has been experiencing talent attrition, may now face an even greater challenge in retaining its employees. Microsoft's decision to create a new AI unit in London closely follows the hiring of DeepMind cofounder Mustafa Suleyman to lead its AI division. In a blog post on Monday, Suleyman announced that the London unit will be managed by former DeepMind researcher Jordan Huffman. While Microsoft already has offices in the UK's capital and had previously committed to investing £2. 5 billion in UK data centers over the next three years, the establishment of this new AI-focused hub, led by former DeepMind members, is likely to cause concerns for Google. Increasing its presence in London could be a strategic move by Microsoft in the battle to attract top AI talents. Suleyman highlighted the wealth of AI talent in the UK and emphasized Microsoft's plans for significant, long-term investments in the region as they recruit the best scientists and engineers for the new AI hub. DeepMind, founded in 2010 and acquired by Google in 2014, has been considered a prominent player in the UK's AI landscape and a valuable asset for Google.

However, facing mounting pressure from competitors like OpenAI, Google integrated DeepMind with its central AI unit Brain last year, creating the new Google DeepMind division. With over 2, 000 employees, Google DeepMind is leading the development of Gemini, Google's response to OpenAI's GPT-4 large language model. It plays a crucial role in Google's AI strategy. As other companies like Meta and Microsoft seek to strengthen their AI divisions with more resources and talent, they are actively trying to attract top researchers from Google, sometimes offering hefty pay packages of up to $10 million. Meta recently lost three prominent AI employees, while Google has experienced a steady stream of departures to OpenAI throughout the past year. Startups, eager to compete with the offerings of Big Tech, are also willing to pay higher salaries to recruit promising candidates, intensifying the talent competition. According to Alex Libre, cofounder and principal recruiter of Einstellen Talent, Google DeepMind has attempted to retain its talent by providing larger compensation packages to select employees. Sergey Brin, Google's cofounder, personally intervened to convince a DeepMind researcher, who was considering joining OpenAI, to stay. As the AI talent race among major tech companies continues to escalate, Google may find itself under increased pressure to prevent further attrition.