- Derek Cai and Annabelle Liang
- BBCNews
image source, Getty Images
With its large population, China has the benefit of a huge consumer base.
Artificial Intelligence (AI) has generated so much interest in the international environment that it was one of the main topics on the agenda of the G7 summit last week.
Concerns of the damaging impact of AI coincide with US attempts to restrict China’s access to that crucial technology.
For now, the US appears to be leading the AI race. And there is already the possibility that current restrictions on semiconductor (chip) exports to China could hinder Beijing’s technological progress.
But China could catch up, analysts say, because solutions to perfect the AI will take years.
Chinese internet companies “are arguably more advanced than US internet companies, depending on how you measure progress,” Kendra Schaefer, Trivium China’s technology drivers research director, told the BBC.
However, Schaefer points out, China’s ability to “produce state-of-the-art equipment and components lags the global leaders by 10 to 15 years.”
The Silicon Valley Factor
The biggest asset of the US is Silicon Valley, without a doubt, the supreme focus of business activity in the world. It is the birthplace of the tech giants like Google, Apple and Intel that have helped shape modern life.
Its unique research culture has been a foothold for innovators in that country.says Pascale Fung, director of the Artificial Intelligence Research Center at the University of Science and Technology in Hong Kong.
Researchers often invest years of work to improve a technology without having a product in mind, says Fung.
For example, the OpenAI firm operated as a non-profit company for years while researching the Transformers machine learning model, which ultimately ended up powering ChatGPT.
“This environment never existed in most Chinese companies. They started building deep learning systems or large language models only after seeing its popularity,” Fung adds: “This is a fundamental problem of China’s AI.”
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China would have to create its own Silicon Valley to stimulate innovation.
US investors have also supported the pace of research in the country. In 2019, Microsoft announced that it would invest $1 billion in OpenAI.
“AI is one of the most transformative technologies of our time and has the potential to help solve many of our world’s most pressing challenges,” Microsoft CEO Satya Nadella said at the time.
The Chinese advantage
Meanwhile, China has the benefit of a larger consumer base. It is the second country in population, with approximately 1,400 million inhabitants.
Also has a thriving industry of Internetsays Edith Yeung, a partner at investment firm Race Capital.
Almost everyone in the country uses the WeChat super app, for example. They use them for almost everything, from sending text messages to making medical appointments and filing taxes.
As a result, there is a wealth of information that can be applied to improve products. “The AI model is only as good as the data it has available to learn from,” Yeung says.
“For better or worse, China has much fewer regulations around privacy and much more data (compared to the US). Everywhere there is CCTV (closed circuit) facial recognition, for example,” he says. “Imagine how useful that would be for AI imaging.”
image source, Getty Images
Most of the Chinese use WeChat for all kinds of transactions and making appointments.
While the Chinese tech community may seem to lag behind the US, its developers have an advantage, according to Lee Kai-Fu, who proposes this theory in his book “AI Superpowers: China, Silicon Valley, and the New World Order.” “.
“They live in a world where speed is of the essence, copying is accepted practice, and competitors will stop at nothing to capture a new market,” wrote Lee, a leading figure in the Beijing internet industry and a former Google China head. .
“This aggressive environment is in stark contrast to Silicon Valley, where copycat is stigmatized and many companies are allowed to move forward only on the basis of a single original idea or a fluke.”
Culture of the copy in China has its problems, including serious questions around intellectual property. But Lee writes that he has produced a generation of robust and agile entrepreneurs ready to compete.
Since the 1980s, China has been expanding its economy, which used to be largely manufacturing-based, to one based on technology, Fung says.
“Over the past decade, we have seen more innovation from Chinese internet companies and high-quality Chinese designs driven by consumers,” he adds.
Can China come out on top?
While China’s tech companies definitely have unique advantages, it is not yet clear what the full impact of Beijing’s authoritarianism will be.
There are questions, for example, whether censorship could affect the development of Chinese AI chatbots. Will they be able to answer sensitive questions about President Xi Jinping?
“I don’t think anyone in China will ask controversial questions on Baidu (Chinese search engine) or Ernie (Baidu product) in the first place. They know they are censored,” Yeung says. “Sensitive topics are a very small part of (chatbot) usage. What happens is that they get more media attention.”
image source, Reuters
The issue of AI and the threat of Chinese influence were hot topics at the recent G7 summit in Hiroshima, Japan.
The biggest problem is that US efforts to restrict China’s access to specialized technology could impede the development of the AI industry.
High-performance computer chips, or semiconductors, have become a source of tension between Washington and Beijing. These are used in everyday devices, including laptops and smartphones, and could have military applications. They are also crucial in the machinery needed for AI learning.
US companies like Nvidia currently lead the development of AI chips and “few (Chinese) companies can compete against ChatGPT given export restrictions,” Fung says.
image source, Getty Images
Nvidia is a leader in the field of chips and semiconductors that power its ChatGPT super app.
While this will impact China’s high-tech AI industries, it will have no effect on the production of consumer technology such as mobile phones and wearables. That’s because “export controls are designed to prevent China from developing advanced AI for military purposes,” says Schaefer.
To overcome this, “China needs its own Silicon Valley; a research culture that attracts talent from diverse sources,” says Fung.
“Until now it has relied on talented people within the country and on foreigners with Chinese heritage. Homogeneous cultural thinking has its limits,” she adds.
Beijing has been trying to close the gap through its “Gran Fondo” programwhich offers substantial incentives to chip producers.
But it has also tightened its grip on the sector. In March, Zhao Weiguo became the latest tech mogul to be accused of corruption by the authorities.
Beijing’s attention to certain industries may offer financial incentives and loosen red tape, but it may also could mean more vigilance, and more fear and uncertainty.
“Zhao’s arrest is a message to other state firms: don’t gamble with state money, especially in the area of chips,” concludes Schaefer. “It’s time to get to work.”
How that message will affect the future of China’s AI industry remains to be seen.
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