The Geopolitics of AI
The Worldwide Race in Artificial Intelligence
Posted May 04, 2018
Artificial intelligence (AI) is becoming a strategic imperative with various nations announcing centralized plans and initiatives to remain globally competitive. Automation is on the rise due to recent breakthroughs in deep learning, the availability of big data, decentralized computing via the cloud, and improved AI algorithms.
“For governments, there is an urgent need to support both firms and citizens to ensure that they benefit from the AI-powered digital economy. This means preparing workers for rapidly changing job requirements, facilitating AI investment and adoption, and solving for broad-based, productivity-driven economic growth.” - McKinsey Global Institute
Globally the most active AI hubs are in Silicon Valley, New York, Beijing, Boston, London, and Shenzhen . Here is a summary of what is happening in AI globally, and what various countries are planning.
According to McKinsey Global Institute, the United States is one of the leaders in AI development :
- Silicon Valley, in the San Francisco Bay Area, was the number one ranked global hub for AI startups with an estimated 12,700-15,600 active startups and two million technology workers.
- In 2016, the United States was in the top spot and accounted for 66 percent of AI external investment, such as venture capital, private equity, and mergers and acquisitions, followed by China at 17 percent.
By 2021, IDC estimates the global spending on cognitive and AI systems to reach $57.6 billion, with the United States spending comprising 75 percent. In 2017, the United States will have invested nearly 80 percent of the worldwide AI and cognitive systems spending . IDC lists retail, banking, discrete manufacturing, healthcare, and process manufacturing as the five industries with the largest investments in AI and cognitive systems that will account for close to 55 percent of all worldwide spending by 2021 .
On May 3, 2018, Cambricon Technology, released China’s first cloud AI chip, the MLU100, designed to support image and facial recognition for AI deep learning . The startup was founded just two years ago in 2016 and has already achieved unicorn status of a $1 billion valuation . Its AI technology is being deployed in millions of phone by third-ranked handset manufacturer Huawei .
SenseTime, a facial-recognition and surveillance technology Chinese AI startup, has the highest valuation for an AI startup worldwide of $4.5 billlion, with Yitu Technology, also a Chinese AI startup, in second place with a valuation of $2.4 billion .
The Chinese government released a plan with the ambition of becoming the global leader in AI innovation by 2030 . In a keynote speech at the 2017 Asia-Pacific Economic Cooperation (APEC) CEO Summit, Chinese President Xi Jinping stated, “China's economy is in a transition from a phase of rapid growth to a stage of high-quality development,” and “We will promote further integration of the internet, big data, and artificial intelligence with the real economy, and cultivate new drivers of growth in digital economy, sharing economy, clean energy and other areas .”
According to an April 2017 report by McKinsey Global Institute, five Chinese government strategic priorities for AI are as follows :
- Create a data ecosystem where international exchange of data streams are encouraged and public-sector data is made available for private uses
- Widen AI industry adoption with tax credits, subsidies and government pilot projects
- Close the AI talent gap through research and education with focus on innovation and digital skills, and attracting global AI talent through immigration policies
- Offer retraining programs for workers displaced by automation
- Create ethical and legal agreement on AI within China and with the global community through regulations, and forming a global organization to promote peaceful, inclusive, and sustainable AI development
In a 2017 speech to Russian students, Russian President Vladimir Putin said, “Artificial intelligence is the future, not only for Russia but for all humankind. Whoever becomes the leader in this sphere will become the ruler of the world .”
In October 2017, Russian technology company Yandex launched a conversational AI assistant called Alice . The company has 55.5% market share in internet search in Russia as of September 2017 . In February 2018, Uber and Yandex merged ride-sharing businesses to form a combined business with an over $3.8 billion valuation, to cover Russia and nearby countries in the region .
Multinational food and beverage giant PepsiCo uses AI software called Robot Vera, developed by St. Petersburg based startup Stafory, to search, identify, qualify, and interview job candidates in Russia . Currently 200 companies use Robot Vera for human resource recruiting and management .
Russian companies are currently using machine learning and AI across diverse industries for various purposes. According to Computer Weekly :
- Russian Gazprom Neft is using AI technology for drilling and pumping automation.
- Internet search and ride-sharing technology company Yandex deploys AI internally to identify potential fraudulent transactions, and for the automation of online bonuses in one of its divisions.
- KamAZ has the goal of creating autonomous trucks by 2025 by using Russian Cognitive Technologies neural network AI software.
- Russia’s largest turkey meat company Damate is running a pilot using AI software from Connectome.ai to automate quality control on the processing line.
- State-run Sberbank uses AI to automate loan decisions, and to recommend additional services and products to customers based on transaction history.
In April 2018, the UK government announced plans to invest £300 million in AI . Other UK initiatives in AI include :
- Establish a £9m data ethics and innovation center to address privacy, safety, and job changes
- British luxury car maker Rolls-Royce is teaming with The Alan Turing Institute, the UK national institute for data science and artificial intelligence, on potential solutions for supply chain and predictive maintenance automation
- The University of Cambridge plans to create a £10m supercomputer for AI research
The European Commission announced in April 2018 plans to invest €1.5 billion by 2020 .
- EU goal is to have combined private and public AI investment to meet or exceed €20 billion by 2020
- EU plans to propose legislation to make public sector data available for AI, such as utilities and transportation
- European private investment in AI was an estimated €2.4-3.2 billion in 2016, far less than the €18 billion invested by the United States and €10 billion invested by Asia in the same year
In March 2018, French President Emmanuel Macron announced plans for the French government to invest €1.5 billion by 2022 in AI research . Macron’s plans include :
- Incentivize French AI researchers abroad, especially in Silicon Valley, to return to France
- Focus on French industry sectors that are data-rich, such as state-run hospitals
- Strategy is to incentivize innovation through AI research funding versus creating a state-run entity like Airbus
Worldwide gross domestic product (GDP) will increase an additional $15.7 trillion, up to 14 percent higher in 2030, due to productivity gains from AI automation according to estimates from the global consultancy PwC . Nations across the world have identified AI as vital technology, and have taken tangible steps in the form of monetary investment and stated policy initiatives in order to be globally competitive in the future.
Copyright © 2018 Cami Rosso All rights reserved.
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