Chinese business leaders are well ahead of their global peers in adopting generative AI, according to a new survey from North Carolina-based software company SAS.
According to a survey conducted by SAS in collaboration with Coleman Parks Research, more than 80% of Chinese business leaders surveyed are currently using GenAI in their work, higher than the global average of 54% and 65% in the United States.
“China is significantly ahead not only in the practical aspects of integrating AI into existing systems and processes, but also in building trust through its preparations to comply with GenAI regulations,” the report said.
Brian Harris, chief technology officer at SAS, suggested China is turning to generative AI to manage its “vast population” and the data collected from it. “Pioneering generative AI could give China a competitive advantage in the world when it comes to unlocking value and data,” he said.
Still, safety and security concerns, including hallucinations, deepfakes and data privacy, are forcing governments to quickly develop rules for the new technology.
According to the SAS survey, nearly 70% of business leaders in Asia Pacific say they feel “fully prepared” or “somewhat prepared” to comply with upcoming generative AI regulations, compared with 59% in North America and 52% in the Nordics.
Last year, Beijing unveiled some of the world's first rules regulating generative AI, requiring chatbots to adhere to “core socialist values” and safeguard national security, but penalties were less severe than observers feared, which analysts interpreted as a sign of Beijing's support for the emerging industry.
In October, the Biden administration passed an executive order requiring AI developers to share safety testing data with the U.S. government, among other measures, and earlier this year, the European Union passed its own comprehensive AI regulations, called the AI Act.
Still, AI companies may find it difficult to navigate the patchwork of different AI rules. “It’s good to have regulation, but having three different regulations is not good,” Harris says. “It’s inefficient.”
China's AI investment
Since the release of OpenAI's ChatGPT in 2022, Chinese companies, both large and small, have been rushing to create their own large-scale language models and generative AI programs.
Big tech companies such as Baidu, Alibaba and JD.com are investing in their own large-scale language models. Baidu claims its ERNIE LLM outperforms the latest version of GPT-4 in some Chinese-language tasks. Chinese startups such as 01.AI, founded by former Google China president Li Kaifu, are also racing to release chatbots and other generative AI products.
But Chinese AI companies are also struggling with a shortage of AI chips, a situation made worse by U.S. restrictions that ban the export of advanced processors (such as those made by Nvidia) to China, with startups reportedly limiting the use of their products due to a lack of computing power.
iFlyTek, a major Chinese AI developer, said on Monday it may report a net loss of up to $64.53 million in the first half of this year. In a filing with the Shenzhen Stock Exchange, the company cited “maximum pressure from the U.S.” as one of the factors. Its shares have fallen 5.4% since Friday's close.
“Every country wants information advantage through AI, from the national security level all the way up to commercial applications,” Harris says. “In that respect, generative AI becomes the new nuclear arms race,” he says.
But Chinese companies have some advantages, including being more “aggressive” than their U.S. peers when it comes to combining data sets and applying them to AI models, Harris said.
He's optimistic that despite the shortage of cutting-edge GPUs, Chinese companies like Alibaba can catch up with their U.S. peers like OpenAI. “What's great about this is that innovation is happening almost simultaneously all over the world, and that's a good thing, right?”
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