In the battle of technology innovation between East and West, artificial intelligence (AI) is on the frontline. And China’s influence is growing.
AI is seen as a key to unlocking big data and the Internet of Things. It allows us to make better decisions faster, and will soon enable smarter cities, self-driving cars, personalized medicines and other new commercial applications to potentially help solve various global problems.
The AI field is going through a time of rapid progress, with improvements in processor design and advances in machine learning, deep learning and natural language processing. China has invested massively in AI research since 2013, and these efforts are yielding incredible results. China’s AI pioneers are already making great strides in core AI fields.
Here are just a few examples: The three Chinese tech giants — Baidu, Didi, and Tencent — have all set up their own AI research labs. Baidu, in particular, taking several steps to cement itself among world’s leading lights in deep learning. At its AI lab in Silicon Valley, 200 Baidu developers are pioneering driverless car technology, visual dictionaries, and facial- and speech-recognition software to rival the offerings of American competitors.
Similarly, Tencent is sponsoring scholarships in some of China’s leading science and technology universities, giving students access to WeChat’s enormous databases, while at the same time allowing Tencent to tap the best research and talent coming out of these institutions.
Even at a government level, spending on research is growing by double digits annually. China is said to be preparing a multi-billion-dollar initiative to further domestic AI advances with moonshot projects, start-up funding and academic research. From a $2 billion AI expenditure pledge in the little-known city Xiangtan, to matching AI subsidies worth up to $1 million in Suzhou and Shenzhen, billions are being spent to incentivise the development of AI.
These developments have not gone unnoticed in the US, the market responsible for much of the early AI research. In the final months of the Obama administration, the US government published two separate reports that noted that the US is no longer the undisputed world leader in AI innovation, and expressed concern about China’s emergence as a major player in the field.
The reports recommended increased expenditure on machine learning research, and enhanced collaboration between the US government and tech industry leaders to unlock the potential of AI. But despite these efforts, 91% of the 1,268 tech founders, CEOs, investors and developers surveyed at the international Collision tech conference in New Orleans in May 2017 believed that the US government is “fatally under-prepared” for the impact of AI on the US ecosystem.
Indeed, the Trump administration’s proposed 2018 budget includes a 10% cut to the National Science Foundation’s funding for US AI development programs, despite the previous administration’s commitment to increase spending.
In contrast, China has shown increasing interest in the American AI start-up world. Research firm CB Insights found that Chinese participation in funding rounds for American start-ups came close to $10 billion in 2016, while recent figures indicate that Chinese companies have invested in 51 US AI companies to the tune of $700 million.
Where East meets West
It is becoming clear that confidence in the US dominance of the tech world is failing.
Of the investors we surveyed ahead of RISE 2017 in Hong Kong this month, 28% cited China as the main threat to the US tech industry. It’s a significant figure, indicating that China’s influence continues to grow. But of further surprise was the 50% of all respondents who believed the US would lose its predominant position in the tech world to China within just five years.
In the medium term, it’s prudent to be cautious on American innovation, at the very least. Historically what has set the US apart has been its capacity to course correct. I’ve no doubt the US will find a new course. But as it stands, China is in the driver’s seat.
Paddy Cosgrave is the founder of Web Summit, RISE, Collision, Surge, Moneyconf and f.ounders.