Too early to pick the leading AI power

The tech will revolutionize industries, create hundreds of thousands of jobs

The United States and China are in a race to become the most dominant in artificial intelligence, or AI. Experts say both economies have strengths and weaknesses that make it difficult to predict which one will come out on top.

"Whereas China overtook the US in AI funding in 2017, ... this sector received five times more money in the US in the period from 2012-16," Georg Stieler, managing director of STM China, a German consulting firm with an office in Shanghai, told China Daily.

In 2017, China pledged that the country would become a global leader in AI by 2030, investing billions of dollars in research and attracting and retaining the brightest talent.

Research by AT Kearney said that 39 percent of almost 450 senior executives polled at large corporations in 23 countries said that China will eventually overtake the US in AI. But 35 percent think it's unlikely.

"The US certainly has the advantage of more experience in this field," Stieler said. "In 2017, it had still four times more AI researchers with 10 years' experience. Although China produces a large number of widely cited AI-related papers, US and UK research remains more influential."

AI is set to revolutionize several industries and create hundreds of thousands of jobs. It is crucial for facial recognition, mobile phones, digital assistants like Amazon's Alexa, cashier-less retail sales, surveillance and even detecting diseases in humans.

China is leading in facial recognition technology and is strong in speech recognition but is still lagging in autonomous cars in comparison to the world leader Google's Waymo, according to Stieler.

Another bright spot for China is that it published 90,000 research papers on AI over the past decade. But the US had the most frequently cited papers compared with China, according to the China Academy of Information and Communications Technology Newsletter.

The US has edged ahead because of its multiple investment streams for AI, in-depth research and a larger research workforce than China.

$75-billion market

As of March 2019, the US also had the most active AI companies in the world: 2,169. But China followed closely with 1,189, 10 of which were privately-owned startups valued at $1 billion, including facial recognition firm SenseTime.

The entire AI market is expected to grow by $75.54 billion during 2019-23, according to a report by Technavio, a leading global technology research and advisory company.

And what will it mean for a country to be dominant in the field? Experts say it will "boost productivity and might also bring military superiority".

To deliver an AI service, such as facial recognition or language translation, one expert says you need both the neural networks (software) and the chips (hardware).

As technology gets more specialized, so do the chips needed to power it.

Linley Gwennap, an analyst for The Linley Group, a US chip research firm, said: "For chips, US companies Nvidia, Intel and Google provide almost all of the chips used for AI in data centers. Huawei has recently begun shipping a datacenter product but hasn't published performance benchmarks.

"The leading smartphone vendors - Samsung, Huawei, Appledesign their own AI chips; others use Qualcomm or MediaTek AI chips. Performance-wise, Qualcomm and Huawei are very close.

There is a need for a new type of processor for AI, as enormous amounts of data are needed to carry out tasks. China has to import much of the hardware necessary for AI from the US, and that has the potential to slow the country down, especially amid a trade war, said Stieler.

"The large cloud-computing centers for the training of neural networks are running primarily on Nvidia chips. Even though there are now alternatives in the form of sophisticated chip designs from Chinese companies such as Huawei's HiSilicon, these firms are still dependent from US chip-design software from Cadence Design Systems or Snyopsis. The most sophisticated chips made by TSMC, Samsung and Intel are using 7-nanometer technology, whereas SMIC, the most sophisticated foundry in the Chinese mainland, is able to master 14 nm. For the production of these chips, you need photolithographic systems, where Dutch ASML is the leading supplier. Losing the access to these technology providers would be a huge setback," he added.