China Erodes US Lead in Artificial Intelligence
Data has become a key focus for the technology industry. Whether offered for sale, getting hacked, kept private, or mined for future innovation, information is recognized for its great value and is at the heart of major technological developments such as artificial intelligence.
However, attitudes toward the use of data vary widely among the world’s major economies. While Europe and North America are tightening data regulation, China is reaping benefits from the willingness of its 1.4 billion citizens to divulge personal information for feeding into algorithms that power intelligent machines. After former Google chief executive Eric Schmidt warned in late 2017 that China would overtake the United States in artificial intelligence as early as 2025, America has awakened to the reality that its advantage is fast eroding.
Earlier this month, UK firm Cambridge Analytica announced its closure after the revelation it had harvested Facebook users’ data for exploitation by political campaigns in Britain and the US. Meanwhile, later this month, the European Union’s new General Data Protection Regulation, designed to give people greater control over who uses and reuses their information, will come into force.
These developments point to the trend for individuals to claw back at least some control over private information that could be packaged and sold without their specific consent or even knowledge.
In Digital We Trust
But in China – where the internet is heavily censored and an estimated 170 million CCTV cameras nationwide means surveillance is ubiquitous – incentives to give up ever more personal data are widespread. According to the Digital Society Index released in February 2018 by media group Dentsu Aegis Network, Chinese internet users lead the world in their trust of the digital economy.
The country’s system of ‘social credit’ – by which citizens’ online behavior earns them ratings of trustworthiness leading to rewards such as preferential access to credit, flight and train tickets and even job opportunities – ensures a steady source of personal information as their high levels of browsing, paying and playing online leave massive digital footprints.
Chinese police are already using facial recognition technology in law enforcement, from CCTV cameras equipped with artificial intelligence to identify and fine jaywalkers, to Google-Glass-style smart glasses to catch suspected criminals.
“Many big data-based technologies that are being pioneered in China these days – from intelligent traffic management to online payment systems – serve the purposes of enhanced surveillance,” says political economist Sebastian Heilmann, founding president of the Mercator Institute for China Studies in Berlin.
Ambitious Competitiveness Targets
But there are other consequences. In an age of big data and AI, an economy with unrestrained data sharing and processing could offer a competitive advantage. A report in April by the McKinsey Global Institute has calculated the economic value to companies of harnessing machine-based deep learning, citing a European trucking company that reduced fuel costs by 15% using sensors to monitor vehicle performance and driver behavior.
Beijing has long sought to create an environment in which home-grown internet companies can develop beyond Silicon Valley-type innovators. But in recent years it has raised the stakes.
Alongside President Xi Jinping’s Made in China 2025 plan to make 10 sectors, including robotics and information technology, globally competitive within 10 years, the country has set a target of becoming the prime innovation center for artificial intelligence by 2030.
Its media heavyweights Baidu, Tencent and Alibaba are making huge investments in artificial intelligence. Shenzhen-based robotics business UBTech announced in May that it had raised $820 million in new funding led by Tencent.
Hardware Dominance
Foreign competitors fear they may be unable to compete with Chinese rivals backed by generous state subsidies. President Donald Trump’s recent imposition of trade tariffs are part of Washington’s attempt to push back the tide, fueled by anger at alleged intellectual property theft stretching back years by Chinese companies and the absence of a level playing field for foreign companies operating in China.
Analysts say three factors create a global-scale power in artificial intelligence: advanced algorithms, specialized computing hardware and plentiful raw data.
Despite its growing concern about China’s evolution, the US is still ahead in the first two categories, attracting the top tech talent and preserving its dominance in key industries such as the manufacture of chips.
But with more experimentation in China as the US clamps down on immigration – and the risk that such pressure will discourage innovators from relocating to America – the situation could change rapidly. Matt Scott, a former Microsoft researcher who moved to China to become co-founder and chief technology officer of start-up Malong Technologies, observes: “A key difference in China is there are just more people, more data, more businesses…It is just bigger.”