When you think of AI, California’s Silicon Valley probably comes to mind. We see daily headlines about the AI activities of Microsoft, Google, Amazon, and Apple. However, in the realm of Generative AI (GenAI), China is leading – at least in terms of patented intellectual property. According to a report released in July 2024 by the UN World Intellectual Property Organization (WIPO), China holds a surprising six times the number of GenAI patents as the United States.

Generative AI, a subset of artificial intelligence, focuses on creating new content through algorithms and deep learning models to generate text, images, music, and other media from existing data. From 2014 to 2023, China filed 38,210 GenAI patents, far surpassing the U.S. (6,276), Republic of Korea (4,155), Japan (3,409), and India (1,350).  

While it’s important to keep in mind that GenAI patents make up only 6% of total AI patents globally, the growth has been rapid, particularly since 2017 with the introduction of deep neural network architectures. And since 2017 China has secured more patents annually than all other countries combined.

Leading Chinese companies like Tencent, Ping An Insurance, and Baidu are at the forefront of this surge, taking the top three positions. These are followed by The Chinese Academy of Sciences, which holds more GenAI patents than any other scientific research organization. The first non-Chinese entity to appear on the list is IBM in a distant fifth place.

The report notes that over 25% of all GenAI patents were filed in 2023 alone, reflecting the explosive interest and advancements in this technology. The applications of GenAI are vast, spanning industries as diverse as life sciences, telecommunications, and transportation, with image and video data dominating the patent filings.

What are the implications of China's lead in GenAI?

Technological Leadership  

China's dominance in GenAI patents positions the country as a global leader in AI technology as a whole. This leadership extends beyond patent numbers to influencing the direction of AI research and development. Chinese companies and institutions are setting technological standards and benchmarks that the rest of the world will follow.

Economic Impact  

China’s massive portfolio of AI patents will drive economic growth in their tech industry. Companies such as Tencent, Baidu, and Alibaba will likely see increasing investment and market share, further cementing China's position as a technological powerhouse.

Global AI Ecosystem  

With such a substantial number of patents, Chinese companies and research organizations will necessarily have influence over global AI standards and practices. This influence would extend to international collaborations, where Chinese entities would steer global AI development priorities and ethics considerations.

Strategic and Geopolitical Considerations  

China's lead in GenAI patents has significant strategic and geopolitical implications. AI is a critical area in the race for overall technological supremacy. China's advancements can enhance its national security and defense. This technological edge can shift the balance of power and influence in global politics.

China's Broader AI Ambitions

Beyond just GenAI, China is making great strides in catching up with American tech giants Microsoft/OpenAI, Google, Amazon, and Apple. The Chinese government has set the ambitious goal of becoming the artificial intelligence world leader by 2030. This calls for massive investments in AI research and development, funding research institutions, universities, and private companies.

China’s roadmap to lead in AI technology was outlined in its 2017 national policy the "New Generation Artificial Intelligence Development Plan." It calls for strong support of AI research, increased funding, promotion of AI education, and talent development. Chinese universities are expanding their AI programs, and the government is encouraging students to pursue careers in AI-related fields.

Chinese tech companies are also acquiring foreign AI firms and entering strategic partnerships to enhance their capabilities. These collaborations provide Chinese companies access to advanced technologies and expertise, helping them bridge the gap with American companies. Chinese companies are also rapidly developing AI-powered consumer products and services, driving innovation and capturing significant market share.

Conclusion

Where all this goes in the future, no one can know for sure. But a few things are certain. The AI race is here and now. And it’s only just begun. The ramifications for much of society and industry are likely to be enormous. China is a major player already and will be in the foreseeable future. And in some areas, China has an unmistakable lead.

Source: World Intellectual Property Organization (WIPO) (2024). Generative Artificial Intelligence. Patent Landscape Report. Geneva: WIPO.

Disclaimer: “The Secretariat of WIPO assumes no liability or responsibility with regard to the transformation or translation of the original document.”

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