OpenAI:- OpenAI, which is behind the generative AI service ChatGPT, has suspended services to China, Hong Kong and Macau, in what analysts said was an escalation of the technology wars between the United States and China.

OpenAI told users in China that it would be blocking traffic from China, Hong Kong and Macau from July 9, China's state-backed Securities Times newspaper reported.

Generative AI like OpenAI's ChatGPT and Baidu's Ernie can assist in the creation of text, images, music, computer code and other content, and is already seeing widespread use in the life sciences, manufacturing, transportation, security and telecommunications sectors.

However, critics fear it could replace workers in some types of jobs or improperly take human-generated content without fair or adequate compensation to the people behind it.

China has issued guidelines for homegrown AI to ensure it sticks to the ruling Communist Party line and doesn’t leak information from outside the Great Firewall of internet censorship.

In 2017, Tencent took down its chatbot Baby Q after it referred to the government as a "corrupt regime," claimed it had no love for the Communist Party and said it dreamed of emigrating to the United States amid reports that its programmers had been hauled in for questioning by police.

Decoupling

OpenAI's move comes as the U.S. Treasury seeks tighter regulation of American investment flowing into China’s tech sector, proposing an outright ban on investment by U.S. citizens and residents in artificial intelligence, quantum computing and semiconductor manufacturing in China.

Analysts said it will accelerate technological decoupling between China and the United States.

While the absence of OpenAI’s advanced models, such as GPT-4, from the Chinese market could slow the adoption and integration of cutting-edge AI technologies, particularly for smaller tech startups, the lack of access to OpenAI's large language models could also spark innovation at home, Dashveenjit Kaur wrote in a July 9 commentary for the website Artificial Intelligence News.

"On the other hand, the blockade creates a vacuum that domestic giants like Alibaba, Baidu, and Tencent are well-positioned to fill," Kaur wrote.

"Those companies have the financial muscle, talent, and infrastructure to accelerate their AI research and development, leading to even more active efforts by these players in AI innovation and building homegrown alternatives for OpenAI."

The Securities Times quoted an industry insider as saying that many Chinese start-ups had been offering products that were just a packaged form of OpenAI with commercial applications.

The move would likely push China's tech companies to speed up their own research and development, the report said.

Patent leader

Alibaba Cloud reacted to OpenAI's block by announcing that its generative AI platform "Bailian" will offer an alternative for former users of OpenAI in China, while Baidu launched a new package for former OpenAI users that allows them to migrate to its AI platform at no additional charge.

China currently leads the world when it comes to generative AI patents, according to recent data published by the World Intellectual Property Organization, or WIPO.

More than a quarter of those inventions emerged last year — a testament to the explosive growth and interest in the technology since generative AI vaulted into broad public consciousness in late 2022, WIPO said.

China has filed more than 38,200 generative AI patents over the past decade, six times more than the United States, which had nearly 6,300. 

But U.S. tech companies are generally making more cutting-edge AI systems, with 61 notable machine-learning models emerging from U.S.-based institutions in 2023, compared with 21 from the European Union and 15 in China, according to this year's AI Index. 

The U.S. also has the most "foundation models," which include OpenAI’s GPT-4, Anthropic’s Claude 3, Google's Gemini and Meta’s Llama, which are huge, versatile and trained on massive datasets.

The U.S. also has led China in private AI investments and the number of newly formed AI startups, while China has led in industrial robotics, Reuters reported on July 3.

On July 4, Chinese Premier Li Qiang called for global cooperation and a more open mindset in artificial intelligence. "Each country has its own advantages in its AI technology, data and market, so we should engage in mutual cooperation and join forces," Li told the World AI Conference in Shanghai.

Li also warned that risks brought about by rapidly developing AI technology would also require concerted international attention.

"No country can be an exception," Li said, calling for the creation of global AI regulation and technical standards. RFA/SP