Here's why London is becoming the next battleground for AI giants

Runway, the New York-based AI company building so-called world models, has chosen London as its European headquarters and pledged to invest more than $200 million into the UK's AI ecosystem by the end of 2028.

Runway co-founder and co-CEO Anastasis Germanidis in an exclusive interview pointed to an existing client base and an established research team already operating in the city.

Current European customers include BBC, Fremantle, and WPP, major players in broadcast, production, and advertising who are already running Runway's tools in active workflows.

"The talent pool is exceptional, and London felt like the right place to start," Germanidis told CNBC, adding that further European expansion is planned in the near future. The UK's AI minister, Kanishka Narayan, welcomed the move, saying Runway's arrival would bring world-model research to industries ranging from film and gaming to science and robotics.

Runway's core technology distinguishes it from the large language model companies dominating headlines. World models learn from audio, images, video, and real-world sensory data, building representations of how the physical world behaves rather than how language works.

Runway also offers a suite of video generation and editing tools, which have made it a significant presence in professional film and content production workflows.

The company most recently closed a $315 million Series E round featuring General Atlantic, AMD Ventures, and Nvidia, a chipmaker whose investment signals confidence in Runway's infrastructure requirements and long-term compute roadmap. The round valued the company at $5.3 billion.

In April, Anthropic announced it was expanding its London presence with new office space for up to 800 people. Days later, OpenAI revealed plans for its first permanent UK office in the capital. Google is relocating employees into a new UK headquarters this summer.