The reporter recently conducted an exclusive interview with Li Kaifu, CEO of Innovation Workshop. Kai-fu Lee is making a heavy bet on machine learning technology, and China has already taken the lead in this field.
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By 2030, China will become a major player in the global artificial intelligence industry. This is not a prediction from a researcher or scholar, but a policy from the Chinese government.
The State Council issued a document last July that plans to develop China into a global leader in artificial intelligence research and applications over the next 12 years. Governments around the world are supporting artificial intelligence innovation, but no other country has issued a unified plan like China. More importantly, China has the ability to do this: China can enforce its established policies more powerfully than Western countries.
However, the plan is only one aspect. In the words of well-known boxer Tyson, "Everyone has a plan before being beaten." But China has not only developed a strategy, but past experience has shown that China has the ability to implement large-scale, ambitious projects. The “Belt and Road†infrastructure project is reshaping many parts of the world. The “Public Entrepreneurship, Innovative Innovation†policy has provided $320 billion to support entrepreneurs, using technology and innovation to drive a structural transformation from industry to services.
Li Kaifu, a star of China's technology industry, said: "The State Council document clearly stated that China will become an artificial intelligence innovation center by 2030. These documents have been effectively implemented in various places." Kai-fu Lee has invested in about 300 companies. Through the venture capital fund innovation workshop, Kai-fu Lee is also a major investor in China's artificial intelligence startups. The Innovation Workshop manages $1.8 billion in capital and invests in both China and the United States.
Li Kaifu pointed out: "All ministries are thinking about this issue, from the Ministry of Science and Technology to the Ministry of Education." He detailed a series of incentives, including subsidies, tax rebates, guiding funds and local government incentives. In China, local governments play an equally important role as private investors. “Traditionally, State Council documents can quickly mobilize the entire country. We have seen China’s high-speed rail and the 66,000 incubators that the dual-initiative (initiated in 2014) brought in more than two years.â€
Li Kaifu, 56, is an ideal candidate for observing China's technology industry. He is in an unusual position, on the one hand, the outsider, and on the other hand, the insider. Li Kaifu was born in Taiwan, and his parents immigrated to the United States and received a doctorate from Carnegie Mellon University. In 1990, he was appointed as the chief research scientist by Apple, working in product and management, and then joined Microsoft in 1998. At Microsoft, he held several senior positions, including the formation of Microsoft Beijing Research Institute. In 2005, he was appointed President of Google China. After working at Google for 4 years, he announced his departure and started the operation of the innovative workshop. At present, through investment in retail, transportation, financial technology and robotics, Kai-Fu Lee has become a star of the Chinese technology circle, with more than 50 million fans on the Chinese social network.
In the past 10 years, China’s entrepreneurial culture has risen rapidly. At present, the value of Chinese technology companies such as Alibaba and Tencent is surpassing that of their American counterparts. Kai-Fu Lee believes that China is enjoying a huge structural advantage, especially from the scale. He said: "The fuel of artificial intelligence is data, and China has more data than other countries. Although the number of mobile phone users is only three times, the number of mobile payments may exceed 50 times that of the United States. These are handled by artificial intelligence engines. Huge data can be used to forecast, improve efficiency, bring more profits, cut labor, and reduce costs. Data advantage is a huge advantage."
In Western countries, the debate about the power and influence of technology companies and how they share and use consumer data continues. At the same time, Chinese users do not have such doubts, and technology companies do the same. Earlier this month, Shang Tang Technology, a Beijing startup that developed surveillance technology, received a $600 million investment with a valuation of $4.5 billion.
Kai-fu Lee said: "Chinese users are willing to come up with personal privacy data for convenience or security. This is not a clear process, but a cultural element."
However, only the policy and market size is not enough. In order to use machine learning and other computer technologies to provide tools for future startups, talent is also a must in the global marketplace.
Li Kaifu pointed out: "There are a large number of engineering students ready to enter the field of artificial intelligence. Many people have the misconception that artificial intelligence is a clever scientist inventing different algorithms for different fields such as medicine, finance, loans, banking, autonomous vehicles, facial recognition, etc. However, artificial intelligence is not the case. The basic innovation of artificial intelligence is deep learning, and everyone is customizing it for different fields."
"So we are not in the era of discovery, but in the era of execution, the era of data. China has more advantages in these areas, many performers, or excellent artificial intelligence engineers, who complete the work and let the algorithm run. Faster and connect to business logic."
Li Kaifu believes that such an advantage means that Europe and the United States need to change the concept that Chinese technology companies are imitators, acknowledging that in fact China's technology is first-class in certain fields. This change of concept is also beneficial to European and American companies. Kai-Fu Lee believes that the biggest danger in Silicon Valley at present is self-centered and self-satisfied with the leading position.
Li Kaifu said: "From a logical point of view, it is time to learn from China. However, in the real world, I believe that Europe and the United States must first realize that China is currently leading in many technologies, business models, products and functions. For example, if WeChat compares with Facebook Messenger or WhatsApp, compares Weibo with Twitter, compares Alipay with Apple Pay, and can see that China is ahead of the US. From a logical perspective, the United States is the time to learn, but in reality the United States has not done so. Entrepreneurs know everything about Silicon Valley, but only a few people in Silicon Valley are very familiar with China. Some people know a little about China, and most people know nothing about it."
Kai-Fu Lee believes that China's best areas are connecting online and offline worlds through complex sensor networks, such as in retail environments.
He said: "Alibaba and Tencent are both developing or investing in physical stores. These physical stores are becoming more and more intelligent, adding artificial intelligence technology, establishing artificial intelligence-enabled supply chain, inventory management, and still using Cameras and other devices to understand consumers, integrate online and offline consumer data, and even develop unattended stores."
In June 2017, Innovation Works invested $4.4 million in the F5 Future Store, an automated retail startup in Guangzhou. Since there is no salesperson, the customer needs to place an order through the smartphone or place an order on the big screen in the store. In mobile-first China, 90% of Internet activity is through mobile devices, and this is the basis for many innovations, including the most complex and seamless mobile payment ecosystem. In this ecosystem, there are currently 700 million online data connections to Alibaba and Tencent's payment accounts.
Kai-fu Lee said: "With the best interior shopping mall layout, the United States has led the world. However, the future shopping malls may be invented by the Chinese, providing a thorough online and offline integration, personalized to each consumer, Efficient combinations of service-intensive products, such as children's play areas and entertainment facilities, as well as automated services such as fast food and convenience stores, etc. Smaller, more efficient shopping will redefine the future shopping experience, which will be happening A large part of the online and offline integration."
Kai-fu Lee described the officials of the State Council of China as "technical pragmatists", which he believes have brought important advantages to entrepreneurs. Similarly, Silicon Valley's orthodoxy is to encourage startups to launch imperfect products in the market, understand what works, and then iterate. "Compared to the discussion of the perfect solution, and then implemented as a law (some Western countries do this), they tend to launch products to see how effective. If the effect is good, then scale up, if there is a problem, Then correct it."
Of course, this could have important economic implications: the American Truck Drivers Union is lobbying to try to protect the work of its members from the threat of self-driving cars. However, in China, such things will not have much impact. This suggests that there are cultural differences between legislators in different countries regarding the structural impact of technology on the workforce. At the same time, as the United States and China continue to consolidate their influence on the deployment of artificial intelligence technologies, smaller countries will be disproportionately affected, as these countries rely heavily on unskilled labor to develop the economy.
“More and more artificial intelligence companies and technology companies will occupy a disproportionate share of the value creation process. Many jobs will be replaced by artificial intelligence.†Li Kaifu said, “Poverty countries can make cheap and cheap labor. The pattern of export development has ended. I believe that this is a challenge for many small countries, especially those countries where technology is underdeveloped and the workforce may be replaced by artificial intelligence."
The hegemony of the United States and China will also have a geographical impact and form two different spheres of influence. One possibility is that US technology companies will dominate Europe and the United States, and perhaps Japan, and Chinese startups are more likely to establish their position in the developing world by working with local companies' technology and capital.
Li Kaifu believes: "Chinese companies infiltrate Southeast Asia, India, the Middle East, and even the South American market. This is possible and good for China. But even without these markets, China is very strong. Many people outside China are saying that 'You have to go outside China to become a large global player'. Although I think globalization is a good thing and China will make progress in this area, I don't think it is very important, because China is now The world's largest unified market. There is a unified language, culture and government, which is completely connected with mobile payments. This may be as important as the entire European and American markets."
Although the United States is still in the lead, Kai-fu Lee believes that the strength comparison will shift. “China clearly has a data advantage. China's engineering capabilities are as good as the rest of the world, at least as close. China's entrepreneurs may be stronger than other countries. The total capital here is comparable to that of the US, and the market is bigger. The pattern of hegemony has become a reality, the difference is that you may say that the United States still has the upper hand today. However, I believe that such a comparison will inevitably change."
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