By Yun-Hee Kim
The U.S. may be winning the race in artificial intelligence for
now. But it won't last for long.
So predicts Kai-Fu Lee, chairman and chief executive of
Sinovation Ventures, a Beijing-based venture-capital firm. He
believes the U.S.'s current technological edge over China could
disappear within five years, thanks to government support, a
growing force of entrepreneurs and their speed of execution.
Mr. Lee, who previously was the head of Google Inc. in China,
recently spoke with The Wall Street Journal about the AI race,
entrepreneurship in China, and prospects for leading U.S. tech
companies in the world's most populous country. Edited excerpts
follow.
China vs. U.S.
WSJ: How do Chinese and U.S. strategies to develop AI
differ?
MR. LEE: China's techno-utilitarian policy encourages technology
to be launched first, observed, and allowed to proceed without
obstruction if things go smoothly. If there are issues, it could
quickly come up with regulations. An example is mobile payments. In
the U.S., this might raise all kinds of lobby, security, hacking
concerns from the credit-card companies and banks. But in China,
Tencent and Alibaba were permitted to try to run payment systems as
software companies, and they did a great job. Mobile payment took
over in China.
In China, a highway is being built with sensors to improve
autonomous driving, new cities are being developed with autonomous
vehicles; some with two layers of roads -- one layer for
pedestrians, pets, bicycles, and another layer for cars. All of
these will help with testing for autonomous-vehicle systems to be
launched sooner. With AI applications, you need a lot of data to do
testing. China has a lot of data, so its approach allows it to move
faster.
WSJ: What do you think the U.S. needs to improve on and where
does China need to invest further when it comes to AI?
MR. LEE: It's going to be about who has more data, faster
entrepreneurs, lots of AI engineers and government support. China
will continue to catch up against the U.S. in terms of building
products and monetizing. What could work in the U.S.'s favor is if
someone disrupts the whole thing with a brand new fundamental
technological change.
WSJ: Which country is ahead?
MR. LEE: In internet AI, which is algorithms making profitable
recommendations for people based on their Web browsing history,
China and the U.S. are about equal. China will probably get ahead
because it has more user data. In business AI, where companies mine
their customer data to come up with new product ideas and improve
service, or use it to monitor systems to make them more efficient
or lucrative, the U.S. is ahead, and will probably stay ahead
because its enterprise data is properly archived and more usable
for AI. In perception AI, or things like facial recognition and
other biometric interfaces, China is ahead because it is building
more sensors cheaply and for broader uses, and it will probably get
further ahead.
In autonomous vehicles, it's incredibly hard to tell because it
depends on policy. The question is, is the road ahead to making
autonomous vehicles ubiquitous mostly about technology
breakthroughs? Then the U.S. is ahead. If it's a matter of rapidly
testing and evolving without policy, lobbying and unions holding it
back, it would be China in the lead.
Work and the workplace
WSJ: What jobs will disappear because of AI?
MR. LEE: Customer service, but not every kind. Customer service
with very high-end human touch will stay. Telemarketing and
telesales will disappear. Dish washing, fruit picking,
assembly-line inspection will all disappear. Paralegals and
accountants -- but not 100%. Some lawyers who do form filling,
those would be replaced.
Creativity-oriented jobs are safe. Working in a construction
environment is safe. Cleaning is hard to do for a robot and every
house is different, so that's safe.
WSJ: China is known for its intense startup work culture. It's
often referred to as 996 -- work 9 a.m. to 9 p.m., six days a week.
Is this a critical factor to the success of Chinese startups? Can
this work culture foster true innovation?
MR. LEE: The most important things are focus, tenacity,
operational excellence, speed of execution and hard work. They all
come together. If you are just hard working but working dumb,
that's not good. Then you get burned out. I'm personally concerned
about my entrepreneurs but I don't have much hope of changing them.
This culture cannot be changed in the next two to three decades as
China still emerges from its current state.
WSJ: Do you think Chinese tech companies will be more successful
because entrepreneurs there do the grunt work?
MR. LEE: The Chinese companies are not nearly as
breakthrough-innovative as the many Silicon Valley greats. Whether
it's Elon Musk or Steve Jobs. The whole Chinese education system
doesn't really easily train these types of brilliant thinkers. But
on the other hand, I think if Silicon Valley or the U.S. continues
to view China as copycats, then it will miss many opportunities.
The stereotype of looking at Chinese companies as lower-quality
copycats will cause American entrepreneurs to have blinders on and
miss stuff they should learn.
Chinese innovation
WSJ: Is there real innovation coming out of China now?
MR. LEE: Absolutely. WeChat [a payment and messaging platform
from Tencent] is an example. If you look at ByteDance [the company
that operates the news-aggregation app Toutiao], while traditional
media may not like the content that's being put through, it's a
very innovative way for displaying content. Think about minivideos
-- Vine [a video app that was owned by Twitter] never worked out,
but Chinese companies are doing great with minivideos. Bike-sharing
apps like Mobike, these are innovative, creative business solutions
that add value, but they weren't created the Silicon Valley
way.
WSJ: Trade tensions between China and the U.S. are making it
more difficult for foreign companies in China and Chinese companies
looking to expand in the U.S. What are the prospects for U.S. tech
companies in China?
MR. LEE: It's almost irrelevant. The U.S. and China are almost
parallel universes. American companies will not succeed in China,
with or without significant regulation. Same for Chinese companies
in the U.S. We're almost at a point, at least in consumer internet
and AI companies, where U.S. companies don't fit the ecosystem.
Let's say ByteDance wants to come to the U. S. -- how are they
going to get people to trust this brand? How will it answer
questions about the newsfeed?
WSJ: So you don't think the Chinese government is making it more
difficult for foreign companies to operate there? Or is it more an
issue that U.S. companies built products that don't work for
consumers in China?
MR. LEE: I actually think Google and Facebook will get some
element of their products in China. But I don't think they will be
successful, just because of the parallel-universe reason. Clearly,
they are talking [about expanding into China] and Waymo [the
autonomous-driving unit of Alphabet Inc.] got approval in Shanghai.
Where American companies are likely to have a chance would be to
work in a simple, nontangled part of this parallel universe such as
doing something brand new.
Ms. Kim is a technology editor for The Wall Street Journal in
New York. She can be reached at yun-hee.kim@wsj.com.
(END) Dow Jones Newswires
November 12, 2018 11:02 ET (16:02 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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