China is overtaking the U.S. in artificial intelligence research, setting off alarm bells on the other side of the Pacific as the world's two largest economies jockey for AI supremacy. In 2020, China topped the U.S. for the first time in terms of the number of times an academic article on AI is cited by others, a measure of the quality of a study. Until recently, the U.S. had been far ahead of other countries in AI research. One reason China is coming on strong in AI is the ample data it generates. By 2030, an estimated 8 billion devices in China will be connected via the Internet of Things -- a vast network of physical objects linked via the internet.

In August, the US government announced the release of $ 1 billion in financing to ensure "that the United States continues to lead the world in artificial intelligence and quantum computing," according to US chief technology officer Michael Kratsios. It seems that the money came too late: for the first time, China surpassed the US in number of AI patents, with more than 110,000 applications filed last year. The news was given by the deputy head of the Chinese Academy of Cyberspace Studies, Li Yuxiao at a press conference on the 23rd, during the 7th World Internet Conference (WIC). "China is strengthening its independence in information technology on the Internet," he said, without mentioning how many AI patents have been registered by the United States. During the event, two studies were presented on Chinese efforts to develop the internal digital economy.

Chinese companies have surged ahead of their U.S. counterparts on a Nikkei ranking of the top 50 patent filers for artificial intelligence over the past three years, expanding their presence in the world's most prominent high-tech battleground. In the three years between 2016 and 2018, China more than doubled the amount of companies in the top 50 to 19 - up from eight in the previous three-year span. Meanwhile, the U.S. kept a tight grip on the top three spots, but only had 12 companies in the top 50 - down from 19 in the previous ranking. The rankings come after U.S. President Donald Trump announced the American AI Initiative last month, a plan to increase research and development in the sector but lacked any specific funding to towards that aim. IBM led the way for the U.S. with 3,000 applications.

The competition between China and the US in AI development is tricky to quantify. While we do have some hard numbers, even they are open to interpretation. The latest comes from technology analysts CB Insights, which reports that China has overtaken the US in the funding of AI startups. The country accounted for 48 percent of the world's total AI startup funding in 2017, compared to 38 percent for the US. In terms of the volume of individual deals, the country only accounts for 9 percent of the total, while the US leads in both the total number of AI startups and total funding overall.