The Biden administration recently announced more regulations on exports to China specifically related to AI chips that power massive data centers at the core of generative AI.
As the world rushes toward the realization of a generalized AI, many countries are seeing the possibilities related to military solutions that would help smaller armies defeat larger ones.
The US is particularly worried about China’s development in this arena.
This tech-based cold war has China rushing to replace many types of American technology.
Reuters is reporting that in 2023, China has more than tripled spending on tech replacement with a particular focus on military and government systems, followed by financial institutions.
State-run agencies were pressed to convert from mainstream software from Microsoft and Adobe and replace it with software developed in China.
Many software companies have been forced over the years to share source codes with Chinese clients as a way to secure large sales.
It is believed that many newly formed Chinese companies are being funded by the government to replace these systems.
It is unclear how effective these replacement systems will be, and many are skeptical if China has enough know-how to easily convert.
Kendra Schaefer, a consultant with Trivium China in Beijing, does not believe that China has the “technical chops to pull off localization until now, and to a certain extent they still kind of don’t.”
In the world of semiconductors and AI chips, China is even further behind with a massive reliance on American-owned companies such as Nvidia and Qualcomm.
However, the Chinese government is focused on mobilizing an independence effort to address these issues and the next several years could see a significant in localized capabilities.