China’s AI Unicorns leading in the field of image recognition

A warehouse in an industrial park approximately a hour’s drive north of downtown Beijing provides a paradoxical image of China’s much hyped, and increasingly controversial, artificial intelligence flourish. Inside the building, a couple of squat robots scuttle about, following a complex and invisible pattern. Occasionally, one zips beneath a stack of shelves, raises it off the earth, then brings it into a station in which a human worker could grab things for packaging. A small number of engineers stare intently in code running on a bank of computers. The robots and the AI behind them were developed by Megvii, one of China’s vaunted AI unicorns. 

The demo that is impressive may seem like further evidence of the AI powers of China, perhaps even evidence that the country is ready to eclipse the US in this area that is crucial. However the warehouse points to a weakness with China’s AI. Amazon has been using comparable technology in US satisfaction centers for years. China’s AI champions have spun AI algorithms into gold in latest years, but that might become harder as the technology becomes more widely available. Megvii, a firm that CB Insights states is valued at about $4 billion, expects to convince clients to purchase its warehouse and manufacturing AI technology, because it seems to move beyond a business built around facial recognition technology. 

The trouble is, AI isn’t proven as a general purpose technology which may easily be applied to various businesses. Broader challenges, including imposed US trade constraints, will make things much harder. These firms aren’t going to be big companies, like Tencent or Alibaba, & rdquo, forecasts Nina Xiang, a business journalist in Hong Kong and author of Red AI, a latest book about China’s AI boom. They’ll stay modest operators, and some evaluations will need to be corrected. In October, Megvii and five other AIs focused firms were added into a US export blacklist, since Chinese governments use their technology for monitoring and control minorities in Xinjiang, a province in China. 

The blockade means that these companies can no longer buy components like advanced microchips out of US firms. China’s AI boom has generated over a dozen unicorns companies valued at greater than $1 billion. These include SenseTime, valued at $7.5 billion, the organization’s Chief executive officer told Bloomberg earlier this season, also Yitu and CloudWalk, both valued over $2 billion. Another prominent AI firm, iFlytek, has been around longer, having started out creating speech recognition technology, and it includes a market capitalization of $10 billion on the Shenzhen stock market. Megvii, that filed to make public on Hong Kong stock market in Sept, has AI experience that is impressive, using developed core calculations and applications. It had been established by several graduates of a renowned AI program at Tsinghua University in Beijing. The organization’s IPO filing supplies a rare insight to the financing of a AI giant, also highlights the provider appears to be on face recognition and surveillance for the time being.

Revenue grew four fold last year to $200 million, in comparison with 2017, but its own City IoT, section, which encompasses surveillance and security systems, accounts for nearly 3 quarters of the revenue. State led development can be both a boon and a curse for China’s AI ventures. When the government declared a grand national AI plan in July 2017, it served as a sign for towns and provinces to put money into AI jobs. Xiang states Megvii along with other AI unicorns seem to be heavily reliant on government contracts, subsidies, along with other sorts of support that is strategic. 

Normally, we may say an important share of those companies revenues is rdquo, & government reliant, she states. The Chinese AI companies have made attempts to move into new areas within the past couple of years. In addition to Megvii’s move into manufacturing and logistics, Yitu praises his work in medical imaging and documents evaluation, SenseTime is investing in autonomous driving, and iFlytek frequently demos tools for analyzing legal documents. The catch is that AI is not proven in these regions, and it is unclear how much revenue the firms have created from all of these ventures. Implementing AI to business demands skills which are rdquo, & more artful, states Qiang Yang, a professor at the Hong Kong University of Science and Technology and chief AI officer in WeBank, a startup founded by Tencent. 

He says a business needs to learn how to use AI tools to solve the real world problems to gather adequate top quality information, and the way these challenges fit into the company life cycle. This is hard, Yang adds. The most significant problem these companies face can be the emerging awareness for investors that, though it appears promising, in most areas AI only is not ready for the big time, says Helen Toner, of the Center for Security and Emerging Technology in Georgetown University, who has studied the growth of AI in China. There is a technical reason behind the predicament. 

AI companies assembled success by using deep learning, an AI technique which has radically improved machine perception in latest years, to problems like speech and facial recognition. Now, as deep learning becomes more widely accessible through APIs and software packages, these companies will need to expand in areas that require more field expertise. Facial recognition has been especially lucrative for companies that are Chinese, and the technology is commonly used across the country. A report issued by IHS Market a week ago concludes a billion surveillance cameras will be in operation worldwide by 2021, with approximately 50% of them in China. SenseTime, by way of example, lately deployed a system in Beijing’s new Daxing airport for China Eastern airlines. This uses facial recognition to allow passengers check in, pass through security, enter the company lounge, and even board a plane without showing a pass. Megvii’s facial recognition technology allows people unlock phones made by Oppo, Xiaomi, and Vivo and log into programs with a glance, it is also comes with security cameras which automatically assess employees into office buildings.