Last year, China’s government put out its plan to lead the world in AI by 2030.
As Eric Schmidt has explained, “It’s pretty simple. By 2020, they will have caught up. By 2025, they will be better than us. By 2030, they will dominate the industries of AI.”
With a $14 trillion GDP, China is predicted to account for over 35 percent of global economic growth from 2017 to 2019—nearly double the US GDP’s predicted 18 percent.
And AI is responsible for a big chunk of that.
PricewaterhouseCoopers recently projected AI’s deployment will add $15.7 trillion to the global GDP by 2030, with China taking home $7 trillion of that total, dwarfing North America’ $3.7 trillion in gains. In 2017, China accounted for 48 percent of the world’s total AI startup funding, compared to America’s 38 percent.
Already, Chinese investments in AI, chips, and electric vehicles have reached an estimated $300 billion. Meanwhile, AI giant Alibaba has unveiled plans to invest $15 billion in international research labs from the US to Israel, with others following suit.
Beijing has now mobilized local government officials around AI entrepreneurship and research, led by billions in guiding funds and VC investments. And behind the scenes, a growing force of driven AI entrepreneurs trains cutting-edge algorithms on some of the largest datasets available to date.
As discussed by Kai-Fu Lee in his soon-to-be-released book AI Superpowers, four main drivers are tipping the balance in China’s favor:
Perhaps China’s biggest advantage is the sheer quantity of its data. Tencent’s WeChat platform alone has over one billion monthly active users. That’s more than the entire population of Europe. Take mobile payments spending: China outstrips the US by a ratio of 50 to 1.Chinese e-commerce purchases are almost double US totals.
But China’s data advantage involves more than just quantity. As China witnesses an explosion of O2O (online-to-offline) startups, their data is creating a new intelligence layer unparalleled in the West.
Whereas American users’ payment and transportation data are fragmented across various platforms, Chinese AI giants like Tencent have created unified online ecosystems that concentrate all your data in one place.
Take mobile payment data, for instance. While the US saw $112 billion worth of mobile payments in 2016, Chinese mobile payments exceeded $9 trillion in the same year.
That means mobile payment platforms like WeChat Wallet and Alipay have data on everything from your dumplings purchase from a street vendor to your recent 100 RMB donation to an earthquake relief fund. This allows them to generate complex maps charting hundreds of millions of users’ every move.
With the unequaled rise of bike-sharing startups like China’s ofo and Mobike, Chinese companies can now harness deeply textured maps of population movement, allowing them to intuit everything from your working habits to your grocery shopping routine.
And as China’s facial recognition capacities explode, these maps are increasingly populated with faces even when you’re not online.
As Chinese tech companies continue merging users’ online behavior with their physical world, the data they collect offers them a tremendous edge over their Silicon Valley counterparts.
This brings me to our second AI driver: hungry entrepreneurs.
While China’s ‘copycat’ era saw a massive wave of mediocre-quality products and unoriginal mimicry, it also forged some of the most competitive, rapidly iterating entrepreneurs in the world.
Refined by fire, Chinese tech entrepreneurs have stopped at nothing to beat the competition, pulling every trick and tactic to smear, outpace and outsmart parallel startups.
Former founder-director of Google Brain Andrew Ng noted the hunger raving among Chinese entrepreneurs: “The velocity of work is much faster in China than in most of Silicon Valley. When you spot a business opportunity in China, the window of time you have to respond is very short.
