AI Superpowers: China, Silicon Valley, and the New World Order

by Kai-Fu Lee

As perception AI finds its way into more pieces of hardware, the entire home will feed into and operate off digitized real-world data. Your AI fridge will order more milk when it sees that you’re running low. Your cappuccino machine will kick into gear at your voice command. The AI-equipped floors of your elderly parents will alert you immediately if they’ve tripped and fallen. Third-wave AI products like these are on the verge of transforming our everyday environment, blurring lines between the digital and physical world until they disappear entirely. During this transformation, Chinese users’ cultural nonchalance about data privacy and Shenzhen’s strength in hardware manufacturing give it a clear edge in implementation. Today, China’s edge is slight (60–40), but I predict that in five years’ time, the above factors will give China a more than 80–20 chance of leading the United States and the rest of the world in the implementation of perception AI. These third-wave AI innovations will create tremendous economic opportunities and also lay the foundation for the fourth and final wave, full autonomy.