AI: China Lags in Implementation but Leads in Adoption

AI Implementation Gap Between China and the US

A recent SAS and Coleman Parkes Research survey revealed a complex landscape in the global adoption and implementation of generative artificial intelligence (AI). While China is at the forefront of AI usage and investment, the United States holds a significant lead in fully implementing this technology.

The survey, which involved 1,600 decision-makers from various industries worldwide, showed that 83% of respondents in China reported using generative AI. In comparison, the adoption rates in the United Kingdom and the United States were 70% and 65%, respectively.

The global average adoption rate is 54%, with key industries like insurance, banking, healthcare, retail, manufacturing, telecommunications, and energy having the highest adoption rates. However, Stephen Saw, Managing Director at Coleman Parkes, stated that the high adoption rates do not translate to effective implementation.

Despite widespread AI usage in China, the integration of generative AI into business processes remains limited. Only 19% of Chinese organizations have fully implemented generative AI technology, compared to 24% in the United States and 11% in the United Kingdom.

Bryan Harris, Executive Vice President and Chief Technology Officer at SAS, noted that organizations are now focused on purposefully implementing this technology to deliver repeatable and trusted business results.

China’s AI Ambitions and Challenges

China’s enthusiasm for AI is evident in its patent filings. According to the United Nations’ World Intellectual Property Organization, China leads the world in generative AI-related patents, filing over 38,000 patents between 2014 and 2023.

This figure dwarfs the 6,276 patents filed by the United States during the same period. Despite these advancements, China faces significant challenges in accessing key AI components developed by US-based companies.

For instance, high-power semiconductor chips, essential for advanced AI applications, are predominantly produced by Nvidia, a leading tech firm based in the United States. Nevertheless, reports indicated that four Chinese startups with a focus on generative AI achieved unicorn status (each surpassed $1 billion in valuation) two months ago.

Additionally, China has integrated generative AI into widely used applications like AliPay. For instance, AliPay now includes features that can detect user attributes such as balding, highlighting the practical applications of AI in consumer technologies.

Tether CEO Proposes Local AI Models to Boost Data Security

In the wake of a recent security breach at OpenAI, Tether CEO Paolo Ardoino has proposed the adoption of localized AI models to enhance data security and user privacy. According to Ardoino, executing AI models locally on devices such as smartphones and laptops can significantly reduce the risk of data breaches and unauthorized access.

The hack at OpenAI, which resulted in the compromise of sensitive internal communications and design details, has raised serious questions about the security of AI systems that rely on centralized servers. Ardoino opined that running AI models directly on users’ devices eliminates the need for third-party servers, enhancing security and privacy.

The Tether CEO further explained that one of the key advantages of localized AI models is their ability to operate offline. Ardoino added that modern devices are powerful enough to handle the execution of these models, allowing users to fine-tune general large language models (LLMs) based on their local data.