A few years ago, China was poised to challenge US dominance in artificial intelligence (AI). The balance of power tipped in favor of China, as it had abundant data, hungry entrepreneurs, capable scientists, and advantageous policies. The country topped the global ranking of patent filings related to artificial intelligence.
Today, many things have changed. Microsoft – an American tech icon – has helped start-up OpenAI launch its experimental chatbot, ChatGPT, to the world. And Chinese tech entrepreneurs are shocked and demoralized.
Many of them realized that despite the hype, China is way behind when it comes to artificial intelligence and technological innovation.
“Why was ChatGPT not invented in China? they wonder.
“How wide is the gap in this area between China and the United States? »
“The Chinese equivalent of ChatGPT? Don’t take it too seriously,” they add.
They also ask more fundamental questions about where the country stands with regard to innovation: Have censorship, geopolitical tensions, and growing government control of the private sector made China less innovation-friendly?
“The development of any significant technological product is inseparable from the system and environment in which it operates,” said Xu Chenggang, senior fellow at the Stanford Center on China’s Economy and Institutions.
He cited the Chinese-language sister app of TikTok, Douyinsuch as the type of innovation that Chinese companies may be unable to achieve in the future due to government restrictions on the sector
“Once the open environment is gone, it will be difficult to create such products,” he added.
If 10 years ago, China was the Wild East of technological entrepreneurship and innovation, it is a very different country today.
Beginning in the 1990s, all major technology companies in the country were private companies financed by foreign funds. The government usually left the sector alone, as they did not understand the internet and did not expect it to become so powerful.
By the mid-2010s, China had emerged as a technological powerhouse capable of rivaling the United States. Its major internet companies were worth about as much in the markets as their American counterparts.
Many products from Chinese companies, such as the messaging application WeChat and the Alipay payment service, performed better than similar US mobile internet products.
Venture capital poured in from all over the world. For a time, the country produced as many unicorns, that is to say start-ups valued at more than a billion dollars, as Silicon Valley.
That all changed in the past few years, when Beijing took on some of the country’s biggest tech companies and its most high-profile tech entrepreneurs.
The objective was to ensure that no institution or individual could exert an influence on Chinese society comparable to that of the Communist Party. The government has taken minority stakes and board seats in some of these companies, giving it effective control.
Along the way, Beijing has tamed the industry’s ambition and blunted its capacity for innovation.
Sticks in the wheels
But tech companies and investors are also to blame for falling behind their Silicon Valley counterparts.
Even before the government began imposing tighter control on them, executives of Chinese tech companies focused on profitability and were reluctant to invest in research projects that were unlikely to generate short-term revenue. After the onslaught of government over the past few years, leaders are even less inclined to invest in long-term projects.
In 2021, the United States led in total private investment in artificial intelligence and the number of newly funded AI companies, three times and twice as many as in China, according to the AI Index 2022 annual report. from Stanford University.
The gap with the United States in artificial intelligence is expected to continue to widen, according to Chinese experts and investors. One of the factors will be Chinese companies’ access to algorithms, that is, the rules that AI tools follow to produce language. Many of them are not accessible to the public, so it will take time for Chinese companies to develop them.
The other factor is computing power: some people in the industry are concerned that the US government will impose export bans on major chips it has not yet banned in order to slow down China’s development in the AI tools like ChatGPT.
For years, China has boasted that it has filed more artificial intelligence patent applications than the United States. But the average number of citations of its AI patents – an indication of the originality and importance of its inventions – lagged behind the United States and many other developed countries between 2020 and 2021, according to Xu Chenggang’s team’s China AI Index.
While China’s tech industry used to be driven by private companies and private venture capital funds, the government is increasingly driving not only how the money is invested, but also the technology that receives the money. He wants to ensure that major research projects are in line with the country’s goal of becoming technologically self-sufficient.
“Chinese policymakers seek to systematically address and integrate each stage of the innovation process,” wrote the Mercator Institute for China Studies in Berlin in a research paper.
On Monday, the Beijing municipal government promised to support big tech companies developing big language models to compete with ChatGPT. Social media comments on this news were largely sarcastic. “Time to grab government subsidies again,” wrote one Weibo user.
The original version of this article first appeared in the New York Times.