February 13 2024
Research & Development,Software/Gaming/IT

Capital Region Emerges as a Top AI Innovation Market

As the University at Albany and Rensselaer Polytechnic Institute ramp up their artificial intelligence and quantum computing capabilities, the Capital Region is already emerging as a top AI innovation market that continues to attract millions in federally funded, AI-related R&D.

Between 2010 and 2022, the U.S. Patent and Trademark Office (USPTO) awarded 315 AI- and machine learning (ML) related patents in the Albany-Schenectady-Troy metropolitan statistical area (MSA). That made the Albany-Schenectady-Troy MSA the 19th top AI innovation metro in the nation, according to a CommercialCafe report. Among those 315 patents, 266 were awarded in Schenectady County, which is home to GE research in Niskayuna. Other AI and ML innovators in the Region include IBM Research, the University at Albany and its College of Nanotechnology, Science and Engineering (CSNE).


Supporting some of the R&D that drives such innovation is federal funding. Over the last five years, federal agencies have awarded 95 contracts and grants totaling $90 million to Capital Region research institutions and firms for AI/ML/quantum-related R&D. In fiscal year 2023, federal agencies awarded 29 grants totaling $10.4 million. That was a 20.8 percent increase in the volume of grants but a 14.1 percent decline in assistance funding, according to a Center for Economic Growth (CEG) analysis of USAspending.gov federal funding data that includes more than 30 AI, ML and quantum computing keywords.1


Two UAlbany spectroscopy-related spinouts were among the recipients of AI/ML-related grants in fiscal year 2023. Sangali is a UAlbany spinout that received a $275,000 Small Business Technology Transfer (STTR) to research combing a highly sensitive type of spectroscopy with advanced statistical approaches, such as ML, for the rapid characterization of wood-based materials. Early Alzheimer’s Diagnostics also received a $274,713 STTR grant that will similarly combine a highly sensitive type of spectroscopy with advanced statistical approaches, such as ML, to “detect biochemical changes in saliva specific to Alzheimer’s disease.”

Other examples of AI-related grants awarded last fiscal year include $760,000 awarded to the SUNY Research Foundation to leverage AI techniques to develop agricultural best management practices to reduced the excess nonpoint source nitrogen and phosphorus loadings that cause hypoxia and harmful algae blooms in U.S. waters. RPI also received a $299,977 grant to  develop “AI-powered approaches to address challenging societal problems, such as dealing with droughts, infectious disease and environmentally harmful emissions.”


In fiscal year 2023, there were also three contracts awarded in the region, totaling $32.1 million. The majority of that funding was attributed to a GE Medical Systems Information Technologies in Niskayuna to develop “AI-enabled algorithms to support assessment of head trauma.” At $28,316,696 for a nearly six-year period, this was the region’s largest AI-related federal contract listed under the selected keywords on USAspending.gov to date. Out of the more than 9,000 federal contracts that have been awarded to GE Medical Systems Information Technologies, this is the first one to list Schenectady (with a Niskayuna ZIP code) as its place of performance.

AI Assets

Capital Region institutions are becoming the first in the nation to install cutting-edge IBM AI technologies. For example, RPI is the first U.S. university to house an IBM Quantum System One. UAlbany was also the first academic institution to install the IBM’s first Artificial Intelligence Unit (AIU) at the new Center for Emerging Artificial Intelligence Systems (CEAIS), a $20 million research consortium between the university and the IBM AI Hardware Center at the Albany Nanotech Complex. In recent months, RPI has joined a AI Alliance led by IBM and Meta, and UAlbany was selected to participate in the National Institute of Standards and Technology’s (NIST’s) U.S. Artificial Intelligence Safety Institute Consortium.  



CEG is working to grow the Capital Region’s AI cluster by collaborating with public and private research institutions to develop grant applications for regionwide R&D projects, helping launch and administer software developer apprenticeships for local software firms, and providing venture pitch coaching to software startups.



1  Contracts and grants were based on new awards only and place of performance. Award amounts were based on their total obligated amount for those with an award base action date in the select fiscal years. Keywords included: AI/ML/quantum keywords include AI, Artificial Intelligence, Chatbot, Cognitive Computing, Computational Intelligence, Computational Learning, Computational Quantum, Computer Vision, Data Mining, Deep Learning, Entity Extraction, Forward Chaining, High-Performance Computing, High-Power Computing, Hyperparameter, Intelligent Agents, Knowledge Discovery, Knowledge Engineering, Machine Learning, Machine Vision, Natural Language, Neural Network, Overfitting, Pattern Recognition, Predictive Analytics, Quantum Algorithm, Quantum Communication, Quantum Computing, Quantum Games, Quantum Mechanics, Quantum Key Distribution, Reinforcement Learning, Sentiment Analysis, Unstructured data, Unsupervised learning. Not included in this list were “algorithm” and “strong AI,” which were used in CEG’s last report on federally funded AI R&D in the region in October 2022. Several quantum keywords were added to this year’s list.


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