Authored by: Sanni Rajaniemi
The artificial intelligence (AI) industry has been rapidly developing in The People’s Republic of China, and the country has quickly become a world leader in the industry. The large and diverse AI industry is also backed by the Chinese government, with recent policies such as: “Made in China 2025”, “Action Outline for Promoting the Development of Big Data”, and “Next Generation Artificial Intelligence Development Plan”.
This blog explores how China has been developing its AI industry, the common types of AI companies in China, how businesses use AI, business opportunities, and the biggest Chinese companies that use AI.
Building AI Infrastructure
China focuses on building globally competitive AI industry clusters and an independent and controllable technology system. Some examples of sectors that AI is being deployed across in China include healthcare, transportation, finance, and retail. The public sector is also a major customer in China’s AI market, and, as a result, it provides lots of opportunities for AI companies in urban governance and operations.
With policies such as the ”Next Generation Artificial Intelligence Plan”, the Chinese government is supporting the long-term development of the AI industry. There is also a National AI Development Fund that is allocated to invest in the research and development work around artificial intelligence. In the meanwhile, the government also encourages the integration of AI in transportation and other sectors. The AI development in China is also supported by the abundant digital infrastructure and data centers.
Founding events and investments in AI in China have been increasing overall in the recent years. For instance, In 2022, the core AI industry reached 580 billion yuan, and there were nearly 4000 AI enterprises. There is a big demand for digital transformation in China’s AI industry, and the market is very hot.
Research on AI’s Real-World Impact
According to Harvard Business Review, China’s progress has been stunning: its global share of research papers in the AI field has increased from 4,26% in 1997 to the top of the world at 27,68% in 2017. Nevertheless, the advancements don’t stay in research papers alone; the industry has made big progress in AI applications such as autonomous vehicles, natural language processing (NLP), computer vision, robotics, and others. Additionally, the new AI technologies are continuously being adapted to the daily lives of the Chinese.
5 Types of AI Companies in China
Understanding the categories of AI companies helps you understand their landscape in China. The local businesses in the artificial intelligence sector usually fall into these five categories:
Hyperscalers have extensive cloud infrastructures and data centers. In AI, they can provide advanced AI capabilities and solutions with the help of their huge resources and expertise.
Traditional industry companies can operate in any industry, and they are enhancing their existing services with AI to increase efficiency, decision-making, and customer experience capabilities. AI can help companies stay competitive in the modern market, especially among the Chinese Gen-Z demographic.
Vertical-specific AI companies address specific challenges with their knowledge of the industry and create solutions with AI.
AI core tech providers usually involve in developing AI technologies and tools, such as algorithms, frameworks, platforms, and software development kits (SDKs). They enable other companies to build new AI applications.
Hardware companies manufacture and develop components, like sensors, devices, and processors, that AI applications require to increase their efficiency.
Leading AI Businesses from China
Businesses use AI to gain a competitive edge and to improve efficiency, for example. Understanding the top AI companies and the competitiveness of the market is crucial if you wish to expand your AI business to China. Here are some interesting leading AI companies in China:
DJI specializes in drone technology, and it is one of the biggest AI players in the country. Their drones are used personally and commercially, and they utilize image recognition software for public safety, fire and rescue operations, etc. DJI also offers agricultural drones that help farmers increase efficiency with crop spraying, mapping, and inspection.
Ubtech Robotics designs and sells humanoid robots. The company has been developing humanoid robots since 2008 and has over 1500 registered robotic and AI-related patents to its name. It’s known internationally for its technical innovations. One of Ubtech Robotics’ well-known products is Alpha 1 Pro, which is a humanoid robot that interacts with people. The Jimu Robot is a system that supports individuals to make their own robots.
SenseTime focuses on computer vision and deep learning technologies, and it’s a leading AI software player in China. Its products and services include facial recognition technology, multimedia analytics, autonomous driving systems, medical imaging systems, and retail analytics that analyze consumer behavior.
Cambricon Technologies is a leader in China's AI sector, specializing in AI core chips. Cambricon is a semiconductor trailblazer with its 1,508 employees across China. The flagship products of the company are the MIPITM neural network accelerator and MLU100 intelligent processor. Cambricon offers a developer kit and cloud services for developers and businesses.
Yitu Technology is a pioneering AI company in China, established in 2012. Yitu is dedicated to enhancing various sectors like finance, security, and healthcare with facial recognition technology, intelligent healthcare solutions, and smart city applications.
Business Opportunities in The Chinese AI Sector
The Chinese market is very receptive to new AI-based products, and consumers are fast to adopt such services and products. Additionally, the signiificant size of the market in China provides advantages in big data and strong economic incentives to tackle technological challenges.
Consumer electronics like virtual assistants and smart home devices are growing segments of AI products, so if your technologies and products are in this area, you could tap into this demand easily. Of course, if it is of your business interest, you can also explore innovative solutions in healthcare and telemedicine.
AI can also be used to enhance the customer experience with personalized marketing, like targeted advertising and recommendation systems, as well as supply chain management.
AI has been adopted in the banking and finance industry, and there are opportunities in fraud detection and customer service automation, for instance. Companies using AI are complying with industry trends and delivering innovative financial services for their customers.
Smart manufacturing, like production processes, predictive maintenance, and quality control, can be developed with AI, which can increase efficiency and reduce costs. Leveraging AI in smart manufacturing helps it stay competitive in the future.
If your business is in education technology, you can also explore AI in personalized learning and intelligent tutoring systems.
In terms of business and the development of new AI innovations, the Chinese market offers variety and a wide range of opportunities for new and traditional firms to explore. As you navigate the evolving Chinese market, embracing AI becomes a game-changer for your business journey. AI not only helps you dissect and understand extensive data but also makes precise predictions and optimizes every aspect of your business operations. AI creates a unique and personalized experience for your customers. This way, your brand resonates personally with your Chinese customer.
Hohot Consulting Oy supports you when entering the Chinese market, providing expertise and strong and extensive knowledge of both the international and Chinese markets by our Mandarin-English-speaking consultants. Learn more about us here.