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

by Kai-Fu Lee

AI startups are taking the opposite approach. Instead of waiting for this grid to take shape, startups are building highly specific “battery-powered” AI products for each use-case. These startups are banking on depth rather than breadth. Instead of supplying general-purpose machine-learning capabilities, they build new products and train algorithms for specific tasks, including medical diagnosis, mortgage lending, and autonomous drones. They are betting that traditional businesses won’t be able to simply plug the nitty-gritty details of their daily operations into an all-purpose grid. Instead of helping those companies access AI, these startups want to disrupt them using AI. They aim to build AI-first companies from the ground up, creating a new roster of industry champions for the AI age. It’s far too early to pick a winner between the grid and battery approaches. While giants like Google steadily spread their tentacles outward, startups in China and the United States are racing to claim virgin territory and fortify themselves against incursions by the Seven Giants. How that scramble for territory shakes out will determine the shape of our new economic landscape. It could concentrate astronomical profits in the hands of the Seven Giants—the super-utilities of the AI age—or diffuse those profits out across thousands of vibrant new companies.