 Being this being a Swiss organization after all let's start this press conference on time Welcome ladies and gentlemen both here in the room and for those of you who are watching on the live stream welcome as well and of course a very warm welcome to To the panelists today You're joining the press conference on China's top 50 AI companies that are reshaping the economy will hear Much more about that in a second, but I won't give up the privilege of introducing a wonderful Panelists today so to my immediate left and right in the heart and center of our panel today. I'm joined by Nina Sheung. She's the managing editor of the China money network based in in Hong Kong and On her other side, we're joined by professor Stuart Russell. He's a professor of computer science at the University of California Berkeley Welcome to both of you. Thank you now the title of the press conference already gives away what we're going to talk about And we are in a good place for that because over the last day or day and a half We've heard a lot already about artificial intelligence. We also heard that artificial intelligence is probably one of the technologies where China is Blazing ahead in comparison to two other countries So I think it's very timely and very interesting to hear both from you Nina tell us a little bit about these 50 companies. You've chosen as the as the top 50 AI companies in China and how they're going to influence the economy, please floor us Thank you George for that. Hi everyone. My name is Nina Sheung. I'm the founder and managing editor of China money network what we do at China money network is Every day we track what's happening in the Chinese venture capital and technology sector and we bring that news intelligence and data to our international readers and followers so naturally AI has been one of the most active high profile and significant sectors We have witnessed for the past few years as the place where top VCs are making tens of billions of dollars into as a as a place where top talents are migrating to and also as an increasing rising technology Penetrating and changing almost every sector in the Chinese economy So just a little bit background on why we did this today because last year in 2017 we released China AI top 10 That really provided some real insights into the superstars in the Chinese AI space So this year really proud to announce the China AI top 50 During the summer Davos conference right here in Tianjin So before I go ahead and just give a very brief introduction of how it produces ranking and also the methodology we used If you're here, you have some prints material. You can see the QR code if you use your phone To scan the QR code you'll be able to access the real report So that might be a very helpful background reading for for you as I explain the methodology so just very briefly how we made this Ranking is firstly we collected data By two ways first we asked companies to submit their data to us So this way we collected hundreds of company data Directly from the company themselves and then we combined and consolidated all this data with our own existing data bank We ended up about with 11 122 companies Under consideration for this ranking then we use the evaluation rated evaluation system to give each company a score We considered about 12 different items across five areas Just very briefly the five areas include Their technology capability the maturity of their products fundraising business fundamentals and future potential So this way we give each company a score and according to the score We came out with three rankings the China AI top 10 China AI top 20 and China AI top 50 So just a reminder the top 10 companies are not compared with each other You know as number one to number 10 they're equal in the ranking That's because of some some limitations which we explained in the full report So we have the three lists that give you really a flavor of who are the super top level Star companies in the Chinese AI space. So what we have found is very interesting Just very briefly to share you with some highlights of Of the findings. So I guess nobody here would ever imagine There are actually 14 Unicorns in the Chinese AI space 14 so I think people don't even you know can can name 14 Chinese AI companies But 14 companies are valued at one billion dollar or more and combined. They're together worth about 40.5 billion US dollars That's very very significant in terms of how this really new and emergent And and pretty much in infancy industry is growing rapidly Another fact is out of the 50 companies only two companies had female founders I think that's an area I've talked to a lot of people who feel that we should definitely do something about this try to encourage all female entrepreneurs to To to to brave into the startup world and build something that can change the world and and Perhaps unsurprisingly 27 of the 50 companies are backed by Chinese government or and The a BAT so the government capitals is actively participating and investing into the Chinese AI space and Of course, the Chinese traditional technology giants are Influencing and shaping the industry's future as well 55.6% of the founders have doctoral or post-doctoral degrees and over 73% have master degrees or above So this is a very It's a very knowledge based and expertise based sector. So this is this comes as expected So I guess I want to leave more time for Q&A later I think that'll be more interesting for any other details. You can definitely read the full report We have about 50 pages of company profiles where we give each company a brief introduction of their history why we Why this company is interesting or significant? And I think reading through those will really give you a flavor of how this industry is growing and What the companies are doing on the company level? So was that maybe I'll I'll pass back to George. Thank you Nina and and let me jump over to you professor Russell So you're based you're based in Berkeley at the University of Berkeley based in California. What are you hearing all that? When are you moving to China? Well, I feel like I'm sort of moving to China anyway because I'm here so often I think this is my fifth visit to China this year And I always enjoy coming here. It's an incredibly vibrant Ecosystem they the AI companies are Very varied and I think the main thing that they benefit from is the size of the online Economy in China, which is enormous actually much bigger than the online economy in the US and And that provides a playground for AI systems You know the real world As opposed to the online world the real world is actually quite tough for AI systems Then you got to build robots. They have to see they have to grasp they have to touch and that's that's all quite difficult Technologically speaking, but in the online world, you can be a successful AI system with it with no eyes and no hands And this has created incredible opportunities, but one thing I see actually Maybe differentiating the the Chinese and the US AI venture capital spaces that there's much more focus In China on the technological capability, whether it's speech recognition Accuracy or face recognition machine translation And a bit less focus on the business model So in the US it's can you come up with a business model some way to to use AI to make money Without so much focus on you know is the AI technology itself really of the highest quality And I think in some areas speech recognition and face recognition in particular China has pulled ahead a little bit of the US in terms of quality But I think there are you know that the real world robotics areas are going to be This is the next big battleground In the in the online space, I think you can coexist Chinese companies and US companies and European companies can coexist because the online world is in some sense infinitely large but in in the real world the first companies to have really successful self-driving cars are going to dominate that industry the first companies to build really successful Domestic robots that are agile that are dexterous that are sufficiently intelligent to function in the household they're going to dominate that space and In these areas Really significant engineering effort is required particularly with domestic robots It's a sort of chicken and egg problem right to to create a physical robot That's agile and dexterous and has high quality perception You're talking about hundreds of millions of dollars of investment in the manufacturing capability and the engineering of those devices and It's useless Because we don't have the AI systems to run it. So it's going to sit there in the corner, you know getting rusty And at the same time we we we have a hard time building the AI systems to run Domestic robots because we don't have any really good robots, you know, I have a I have a robot in our lab It cost us four hundred thousand dollars And it doesn't even have hands, right? It has grippers like this but no fingers So it's a lot a lot of stuff it can do in the household So if whoever breaks that chicken and egg cycle Is going to win really big because now you can then you can put robots out in Construction and agriculture and domestic situations elder care healthcare You name it and that's going to be a huge wave of value for the human race Thank you, professor. I've let me follow up on one thing You just mentioned that you said the where's the focus in the s is very much in the business model in China It's really on the technological angle Is in your opinion and you know feel free to chime in is that a fact of the strong role of government and financing? AI companies here and do you think that will stifle their chances on the global market once they move out of that out of that space? It could be that it could just be that I think for a long time in the US the Company formation has been led more by MBAs than by PhDs and And I think in China is more of an engineering dominated culture You know even all the way up to the top levels of the government. That's true So I think it's a bit more respect for the quality of the technology as opposed to just can I can I find some way to make money out of it? Actually, yeah, I Do you feel at least you know for the 50 companies who are in the ranking? They actually have a keen focus on commercialization And they have actually progressed Significantly on the road of commercialization. So that means some AI come, you know, most of these AI companies on the ranking They have already have mature products and services that enterprises or consumers can buy can use as technology solutions some companies have already secured significant revenue and revenue growth and Some companies, you know are even predicting they will be making profits as an AI company So that is quite amazing and I think I think in China actually the focus is about application It's less about fundamental core technology research But it's really about how do you use this technology in real business? scenarios in real industry Verticals and how do you actually produce products that can create very concrete? Efficiency improvements or cost-cutting for businesses and this has been you know, this is happening Really if we talk about how these companies are changing the Chinese economy This is how they're changing the Chinese economy by Incorporating all this technology capabilities so that companies are saving costs. They're improving their efficiency And and and I would say, you know, we do witness this strong focus On commercialization Perhaps, you know, some companies are still a little bit left behind but the industry as a whole a quiet advance in that respect I think Before I open the floor for questions The professor mentioned some some areas where the AI Technology will be applied you mentioned agriculture you mentioned health and others and from the let's say focus on the top 10 List what do you see there or maybe go to the top 20? Do you see a concentration in a certain area or focus on a certain industry? Yes, certainly. Yes, so we look at them by two Aspects one is the technology area the focus or they they utilize to to make their products and services Another is the industry vertical. They apply this technology. So overwhelmingly we see these companies are centered around What we call You know the the census so letting machines see so computer vision voice recognition so letting Machines to be able to hear and speak and and also natural language processing So if we we also did an analysis on the whole industry and we see over 80% of the companies are focused on computer vision Voice recognition natural language processing. So these are very basic Functions this industry is trying to add or help machine to see and hear and understand my machine interaction this process So definitely that's a focus in terms of technology in terms of industry for the top 50 companies The top top industry is Public security. So in China. What does that mean? That means? That means Public security police departments big data platforms That means office building public space public security insurance in or Systems so that means Trinstation surveillance cameras. How do you process the video content and? Simultaneously recognize people objects vehicles accidents Violations of traffic rules So this is really a big sector in China public security That's a top sector we find for the top 50 companies the other very active sectors include Financial services of course is another big sector and also education and health care AI chips as we all know recently has been very much a hot topic in China China has no has very little Capability to produce their own chips the special AI chips and this is Area that we have seen recently in the past few months a lot of companies are getting into But we for the industry as a whole only 3% of the AI companies are engaged in a chip Design or chip manufacturing. So this is a place we see in the future. Definitely will be witnessing a lot of rapid growth Professor when the when the forum Started 12 years ago as science and technology meeting in China a lot of people in Europe and the US were asking Why do you do a technology meeting in China? I think they understand that very much today and the press conference is another another proof point when you talk to a I your fellow AI experts and Also a lot of people in the in the industry in the US Are they aware of how advanced China is in that field already or are they are they missing what's actually happening? Absolutely, I mean if you go to any major conference You will see a very large fraction of the papers that coming from China these days So so everyone is very very much aware of this. I would say it's still the case that the The major conceptual breakthroughs are coming from primarily the US academic sector But I it seems inevitable that that also will shift as time goes forward So China's been Very fortunate in that that it's it's able to attract very large numbers of students into these technical areas Partly because it has very good mathematics education Which is an essential prerequisite. So for all these students out there take more math courses before if you want to get into AI and And so inevitably as long as the university sector in China is well maintained And we prevent a brain drain out of the academic sector Into industry then I think we'll see Big basic research breakthroughs happening in China And those benefit everyone of course. I just want to add that actually companies in China Also realizing they need to strengthen research and development spending or investment to ensure that in the long term they can they're able to Remain competitive. So they realize that they cannot build a sustainable long-term business without Keep investing into Fundamental R&D. So we see that, you know, that's happening among the 50 companies today on the ranking for sure So let's come back next year and check the list and see which of the 50 are still I've been very selfishly asking all the questions myself We have members of the media in the room who are of course keen to ask questions of their own please If you could identify yourself And name your name and organization. We have microphones here Especially for the sake of our online audience, please the gentleman in the front. Thank you Thank you. I'm Daisuke Fruta from BuzzFeed Japan. I have a question about the playground for AI system Yeah, AI system needs data to run by itself And China is known for the about the protection of personal information China is not so strong than other countries. So is it a strong point for of China for AI companies because they can use data really So that's a very interesting question and and I just spent a year living in France where The the GDPR the general data protection regulations are a very big issue for the AI industry and I think at the moment. Yes, I would say Chinese companies probably have access to more data Not just for more people and I think that's it That's probably something where people get confused. It's not how many people you have in your database It's how much data you have about each person that matters most and But I think what's happening in in the technology space is that we're developing ways of doing machine learning Using completely encrypted data meaning that your data remains totally private But it can still contribute to running a machine learning algorithms that produce voice recognition or machine translation systems or whatever it might be so you can have the best of both worlds you can have complete privacy and Total ability to create machine learning data from very large data sets Thank you very much. I just want to add For the companies that we actually talked to because this time we did talk to dozens of companies across Beijing Shanghai Shenzhen and elsewhere and When we were talking with them, of course, this is a question we asked them as well A lot of companies are taking actions to protect user privacy for example For healthcare company or AI company trying to apply AI technology in healthcare in medical imaging So they need large amount of data for example lung cancer so they need perhaps a large data set of the medical image of lung cancer and They need to access the data from hospitals So they will be working with perhaps dozens of hospitals across China They get that data from the hospital through a partnership. However, they do protect individual patients privacy by taking out the Individual patients identification. So you wouldn't know who this patient is You wouldn't know its name. You wouldn't know it's perhaps you need to keep some other metrics to to in order to contribute to how The medical imaging is corresponding to perhaps the age and the sex whatever so so they are taking actions to protect user Privacy and a lot of these companies are actually engaging very Constructive dialogue with government agencies. They all tell us that they they talk to the government agencies They actively try to engage with conversation about how to set up standards to protect user privacy And also to ensure data security So we do see some encouraging signs from the industry that the companies are doing things to ensure that We do have privacy and we have data security Thank you Nina. Do we yes, there's a lady with a question there, please Identify yourself and I'm from new finance of the risk. My question is there are 14 AI unicorns in China. There's a very big number. So is there a possibility? They are overvalued Thank you. Yes So we did ask a lot of companies or experts we talked to and we asked them to use three words to describe the Chinese AI Industry right now and the most frequently used words hot crazy Overvalued so for sure definitely Everybody who's in the industry who work in the company themselves and everybody who's an expert academia Of the industry or observer. They do agree that there is a certain overheated Atmosphere in the current AI space for sure and a lot of people expect in the next Year term, we will definitely see a correction. So that means a reduction of the number of AI companies out there The ones who doesn't make sense doesn't have the core technology capabilities will perhaps disappear And we'll also see the valuation perhaps having Having to dial back a little bit because a lot of companies are Able to you know, they are able to raise fundraising at valuation that often double in the matter of Few months and that as we know is is a sure sign of Overoptimism perhaps so definitely There is a consensus on Overheatedness of the industry for sure Do we have any more questions from the audience? Otherwise, I'll use the opportunity to ask a question So you mentioned that AI is heavily developed and beginning to be used especially in for security and safety Now I'm come from Germany whether you have literally kind of the term German angst German is always a bit afraid of new technologies Do you imagine that you'll see something similar in China that you see a backlash against the technology because it is used in Particularly for safety and security in that particular space Putting you on the spot a little bit here, but let's let's I can't really speak for China I could sort of speak for the world in in general. I think that there is a legitimate concern Actually at several levels There's very real concern about the use of AI for weapons And I think that concern is very justified And I'm very happy that China has actually supported an international treaty banning autonomous weapons I I think that there could also be a backlash Against AI systems used both for surveillance and what we might call persuasion technology So increasingly it's possible to to customize the information flow to an individual in order to modify their behavior and It might actually be Almost accidental right you might simply want to modify the behavior so that they spend more money or they click on ads more often But you may find that in the process of doing that you're actually creating a monster You're turn, you know, you find you you will end up feeding that person false information inflammatory propaganda articles and And then creating a monster in the process. So so this surveillance and persuasion industry I think needs to look very carefully at their own ethical standards And and I believe that we will start to see regulation to protect people And I think this is this is a really important thing even something as simple as a law that says that Any machine that's communicating with me has to identify itself as a machine So that I know that I'm dealing with a machine and not a person That would be a simple step. I think we could pretty much all agree to that But that will be an important step. I just want to share. Thank you professor Russell. That's very interesting What we see During our visits to our companies a very interesting thing is we're visiting a facial recognition company and They have a camera right at the entrance of the company's Lobby so that means everybody who's entering the building will be will have their face scanned And if you work in the company your name and your number will appear on the big screen above above the the the lobby wall so Interestingly we see some some employee who entered the building purposefully Covered their face so they cover the face so that the camera wouldn't capture their face wouldn't scan their face and wouldn't have their Name and other information display on the computer screen So I think as this technology become more Prevalent and people will realize that they they want to put protect their privacy And I think this kind of feedback from the public Will push the government and regulators to to take action So so I'm overall optimistic. I think you know the People and users and the public will be able to push for protective measures Thank you very much perfect closing words for this press conference again. We started on time Let's let's keep that virtue and end on time. Thank you very much to both of you for presenting these interesting Insights on artificial intelligence and especially on the role of China there Thank you very much for being in the room here with us today and also. Thank you to everyone watching live. Thank you very much Thank you