The US has reclaimed the number one position in terms of investing in artificial intelligence (AI) technologies in 2018, following losing the spot to China in 2017, according to ABI Research.
The US accounted for 52.3% of the global publicly available venture capital for AI startups in 2018. The US invested $9.7 billion in 2018.
The trade wars and race to become the world’s number one economy between the US and China is expected to increase the US’ share to 70% ($14 billion) in 2019.
Lian Jye Su, a principal analyst with ABI Research, said: “The United States is reaping the rewards from its diversified AI investment strategy. Top AI startups in the United States come from various sectors, including self-driving cars, industrial manufacturing, robotics process automation, data analytics, and cybersecurity. All these startups research on and invest in cutting edge deep learning technologies in their solutions, democratizing AI for enterprises and end consumers.”
Despite losing the number one spot to the US, China managed to achieve a 54% year-on-year growth rate in 2018 by investing $7.4 billion.
Chinese AI startups, despite having connected with the domestic market, will be restricted to expand globally due to US regulations and different market conditions.
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Another challenge for Chinese startups lies in the slow adoption of AI in traditional enterprises in the domestic market as compared to the US, where labour cost and skill shortage are key concerns.
“There is no doubt that Chinese AI investment is feeling the pinch of reality, but China is still undeniably the largest single market for AI implementation. Favourable policies and flexible regulations in China, backed by a government willing to invest and deploy innovative technologies at scale, will certainly amplify AI adoption in the region. While the United States may be leading in investment in AI research and development, in the longer term, China will be able to capitalise on those technologies and bring them to the masses,” concludes Su.
These findings are from ABI Research’s Artificial Intelligence Investment Monitor 2018 application analysis report.