China

Chinese researchers develop AI hospital town to revolutionise healthcare

AI is making significant strides in the healthcare sector, with Chinese researchers developing an AI hospital town that promises to revolutionise medical training and treatment. Dubbed ‘Agent Hospital’, this virtual environment, created by Tsinghua University researchers, features a large language model (LLM)-powered intelligent agents that act as doctors, nurses, and patients, all capable of autonomous interaction. These AI agents can treat thousands of patients quickly, achieving a 93.06% accuracy rate on medical exams. This innovative approach aims to enhance the training of medical professionals by allowing them to practice in a risk-free, simulated environment.

The AI hospital town not only offers advanced training opportunities for medical students but also has the potential to transform real-world healthcare delivery. The AI hospital can provide valuable insights and predictions by simulating various medical scenarios, including the spread of infectious diseases. The system utilises a vast repository of medical knowledge, enabling AI doctors to handle numerous cases efficiently and accurately, paving the way for high-quality, affordable, and convenient healthcare services.

While the future of AI in healthcare appears promising, significant challenges remain in implementing and promoting AI-driven medical solutions. Ensuring strict adherence to medical regulations, validating technological maturity, and developing effective AI-human collaboration mechanisms are essential to mitigate risks to public health. Experts emphasise that despite the impressive capabilities of AI, it can only partially replace the human touch in medicine. Personalised care, compassion, and legal responsibilities are aspects that AI cannot replicate, highlighting the indispensable role of human doctors in healthcare.

US defense group claims that China harnesses open-source software for military

A Chinese nonprofit organisation linked to the government is reportedly coordinating efforts among major tech firms in China to develop open-source software with potential military applications, according to a report from the Jamestown Foundation, a US-based defence policy group. The OpenAtom Foundation oversees the development of open-source operating systems, including OpenHarmony, a variant of Huawei’s Harmony OS that was developed after the company faced US sanctions.

OpenAtom’s efforts extend beyond civilian use, with initiatives to develop alternatives to US technologies for defence applications, such as satellite systems. The foundation led the adaptation of OpenHarmony for Chinese satellites, which was launched in the previous year and is capable of capturing high-resolution images at a low cost.

Sunny Cheung from the Jamestown Foundation highlights OpenAtom’s pivotal role in China’s strategy for technological self-reliance, noting that many of its leaders have ties to the Chinese Ministry of Industry and Information Technology, and a significant portion of its staff are affiliated with the Chinese Communist Party. However, China’s foreign ministry declined to comment on these allegations.

While most of OpenAtom’s sponsors are Chinese firms like Alibaba and Tencent, US chipmaker Intel is also involved. Intel emphasised its commitment to fostering an open ecosystem strategy globally. The Jamestown Foundation suggests that the US should consider promoting its own open-source software initiatives to prevent China from gaining an advantage in this domain, which has largely been left to the private sector until now.

Taiwan accuses Chinese firms of illegal operations and talent poaching

Taiwanese authorities have accused Luxshare Precision Industry, a Chinese Apple supplier, of illegally operating in Taiwan and attempting to poach tech talent. The Ministry of Justice Investigation Bureau identified Luxshare as one of eight companies from China engaging in these illegal activities but provided no further details. The crackdown is part of Taiwan’s broader efforts to protect its high-tech industry from Chinese firms trying to steal expertise and talent.

Additionally, the investigation bureau named Zhejiang Dahua Technology, a video surveillance equipment maker blacklisted by the US in 2019 for its role in the treatment of Muslim minorities in Xinjiang. Zhejiang Dahua allegedly set up covert operations in Taiwan and attempted to obscure its activities by listing employees under a different company name. Both Luxshare and Zhejiang Dahua have not responded to these accusations.

Taiwan, home to semiconductor giant TSMC and a leader in advanced chip manufacturing views these Chinese efforts as a significant threat to its technological edge. The bureau emphasised its commitment to cracking down on illegal operations and talent poaching, warning that it will enforce the law resolutely. This announcement follows a sweep conducted earlier this month targeting suspected illegal activities by Chinese tech firms.

Chinese national behind 911 S5 botnet arrested in Singapore

The US Department of Justice (DOJ) announced the arrest of a Chinese national, Wang Yunhe, in an international operation targeting cybercrime. Wang, aged 35, was apprehended in Singapore on 24 May for allegedly creating and using malware responsible for cyberattacks, large-scale fraud, and child exploitation. This arrest comes on the heels of a similar high-profile sweep last August, involving 10 Chinese citizens charged with laundering over $2 billion through Singapore.

According to the US Treasury Department, the botnet, known as ‘911 S5,’ was used by criminals to compromise personal devices to further conduct identity theft, financial fraud, and child exploitation.

The Treasury’s Office of Foreign Assets Control has now imposed sanctions on three Chinese nationals behind the platform—Yunhe Wang, Jingping Liu, and Yanni Zheng—and on three entities owned or controlled by Yunhe Wang. FBI Director Christopher Wray described the ‘911 S5’ botnet as likely the world’s largest, comprising malware-infected computers in nearly 200 countries.

According to the DOJ, Wang and unnamed accomplices developed and distributed malware that compromised millions of residential Windows computers worldwide. From 2018 to July 2022, Wang accrued $99 million from selling access to hijacked IP addresses, facilitating cybercriminals in bypassing financial fraud detection systems. These criminals committed fraud, resulting in losses exceeding $5.9 billion, including 560,000 fraudulent unemployment insurance claims.

Wang used the illicitly obtained proceeds to acquire assets globally, spanning properties in the USA, Saint Kitts and Nevis, China, Singapore, Thailand, and the UAE. His possessions included luxury sports cars, numerous bank accounts, cryptocurrency wallets, luxury watches, and 21 properties across multiple countries. Matthew S. Axelrod from the US Department of Commerce’s Bureau of Industry and Security described the case as resembling a screenplay, highlighting the extensive criminal enterprise and lavish expenditures financed by nearly $100 million in profits.

The operation is a collaborative effort led by law enforcement agencies from the US, Singapore, Thailand, and Germany. It underscores the international cooperation required to combat cybercrime effectively.

The FBI has published information at fbi.gov/911S5 to help identify and remove 911 S5’s VPN applications from infected devices.

China’s AI chipmakers closing gap on global leaders

China’s domestic AI chipmakers are rapidly closing the gap on international leaders, according to Xu Bing, co-founder of SenseTime Group Inc. Despite the significant lag in computational power compared to the US, China possesses the talent and data necessary to advance in the AI field, Xu stated during an interview at the UBS Asian Investment Conference in Hong Kong. SenseTime, a leading AI company in China, faces challenges due to US sanctions that restrict access to advanced AI technology, such as Nvidia’s accelerators.

The US trade controls have spurred the development of domestic alternatives from companies like Huawei Technologies and Shanghai Biren Technology, both also affected by US restrictions. Xu emphasised that although Asia faces a considerable shortfall in computational resources, the region is abundant in talent and data. He noted that China’s AI chip industry is catching up quickly, with SenseTime collaborating with local semiconductor firms to enhance their computing capabilities.

While the exact gap between Chinese and US AI technology is uncertain, estimated between one to three years, Xu is optimistic that this disadvantage in computing power will be temporary. He believes that, over time, the disparity in computing resources will diminish, viewing computing power as a commodity China will eventually acquire in sufficient quantity. Notable Chinese companies making strides in AI chips include Moore Threads Intelligent Beijing Co., Huawei, and other key players like Baidu Inc. and Naura Technology Group Ltd, which have received government attention and support.

China establishes third state-backed fund to boost semiconductor industry

China has established its third state-backed investment fund to bolster the semiconductor industry, with a registered capital of 344 billion yuan ($47.5 billion). The initiative underscores President Xi Jinping’s push for self-sufficiency in semiconductors. The matter has become more urgent following US export controls aimed at limiting China’s access to advanced chip technology due to security concerns. The new fund, the largest yet from the China Integrated Circuit Industry Investment Fund, was officially set up on 24 May and registered under Beijing’s market regulation authorities.

The fund’s major stakeholders include China’s finance ministry, which holds a 17% stake, and China Development Bank Capital, with a 10.5% stake. Seventeen other investors, including five major Chinese banks, also contribute to the fund, each adding around 6% to the total capital. The substantial investment has already sparked a positive response in the market, with the CES CN Semiconductor Index rising by over 3%, marking its largest one-day gain in over a month.

Why does it matter?

The Big Fund, as it is known, has been pivotal in supporting leading chip manufacturers in China, such as Semiconductor Manufacturing International Corporation and Hua Hong Semiconductor, as well as emerging players, such as Yangtze Memory Technologies. The third phase will emphasise investments in chip manufacturing equipment, a strategic move to enhance China’s production capabilities. The ongoing effort highlights China’s determined bid to overcome technological barriers and secure its position in the global semiconductor landscape.

Nvidia’s latest AI chip struggles in China market

Nvidia’s latest AI chip, the H20, tailored for the Chinese market, is struggling with weak demand, leading to prices dropping below that of rival Huawei’s Ascend 910B chip. Despite being Nvidia’s most advanced product available in China, the H20’s abundant supply suggests it needs to gain more traction. This comes as Nvidia faces stiff competition and US sanctions that have significantly impacted its business in China, a market that previously contributed 17% to its fiscal 2024 revenue.

The competitive pressure and sanctions create uncertainty for Nvidia’s prospects in China. Senior executives acknowledged a substantial drop in their data centre revenue from China since new export control restrictions were implemented. Market analyst Hebe Chen noted that Nvidia is trying to balance maintaining its presence in China while navigating US tensions and preparing for potentially worse outcomes in the long term.

Huawei’s aggressive expansion and increased shipments of its Ascend 910B chip, which reportedly outperforms the H20 in some metrics, further challenge Nvidia. While Nvidia’s H20 has seen some orders from major Chinese tech firms like Alibaba, its success is constrained by Beijing’s preference for domestically produced chips. With a significant price discrepancy between Nvidia’s H20 and Huawei’s 910B, Nvidia’s margin squeeze is apparent as it competes in a market increasingly dominated by local players.

iFlytek slashes AI model prices amid tech price war in China

AI firm iFlytek has entered a price war among China’s top tech companies by significantly reducing the cost of its ‘Spark’ large-language model (LLM). iFlytek’s move follows recent price cuts by Alibaba, Baidu, and Bytedance for their own LLMs used in generative AI products. Spark Lite, launched last September, is now free for public use, while Spark Pro and Max versions are priced at just 0.21 yuan (less than 3 cents) per 10,000 tokens, which is five times cheaper than competitors.

iFlytek claims that Spark surpasses ChatGPT 3.5 in Chinese language tasks and performs comparably in English. The Hefei-based company, renowned for its voice recognition technology, highlighted that Spark’s pricing allows significant cost savings. For instance, Spark Max can generate the entirety of Yu Hua’s novel ‘To Live’ for just 2.1 yuan ($0.29).

State-owned China Mobile, holding a 10% stake in iFlytek, is its largest shareholder. Strategic pricing aims to make advanced AI technology more accessible to the public while challenging the market dominance of other tech giants.

Price war escalates in China as Alibaba and Baidu cut AI costs

On Tuesday, Chinese tech giants Alibaba and Baidu significantly reduced prices for their large-language models (LLMs), intensifying a price war in the cloud computing sector. Alibaba’s cloud unit announced cuts of up to 97% on its Tongyi Qwen models, with the Qwen-Long model now costing only 0.0005 yuan per 1,000 tokens, down from 0.02 yuan. Baidu quickly followed, making its Ernie Speed and Ernie Lite models free for all business users.

The price reduction comes amid an ongoing price war in China’s cloud computing industry, with Alibaba and Tencent already lowering prices for their cloud services. Cloud vendors in China have increasingly relied on AI chatbot services to boost sales, spurred by the popularity of OpenAI’s ChatGPT. The competition has now extended to the LLMs powering these chatbots, potentially impacting profit margins.

Other companies have also joined the fray. Bytedance recently slashed the prices of its Doubao LLMs by 99.3% below the industry average for business users. Chinese startup Moonshot introduced a tipping feature for prioritising chatbot use, targeting both business and individual users. Baidu was the first in China to charge consumers for its LLM products, with its Ernie 4 model costing 59 yuan per month.

Microsoft offers relocation to AI employees in China amidst US-China tech tensions

Microsoft is offering its China-based employees working in AI the opportunity to relocate to overseas locations such as the US, Australia, and Ireland, according to sources familiar with the matter. The offer extends to Azure cloud computing team employees, who were notified earlier this week and have until 7 June to decide. Those who opt not to relocate can remain with the China team, although Microsoft has halted new hiring in China, eliminating job openings.

The relocation program affects approximately 700 to 800 people, primarily those engaged in machine learning. Microsoft has offices in Beijing, Shanghai, and Suzhou but has not responded to requests for comment regarding the relocation offer. Last year, Microsoft relocated some of its top AI researchers from China to a new research lab in Vancouver, Canada, as part of its broader AI strategy.

Why does it matter?

The offer to the employees comes amidst escalating geopolitical tensions between the US and China, which have increasingly impacted corporate decisions. At a bilateral meeting in Geneva, US officials expressed concerns about the misuse of AI, particularly by China. The Biden administration is considering new restrictions on exporting proprietary AI models to China, reflecting growing scrutiny over technology transfer.

Despite these tensions, Microsoft remains committed to its AI services in mainland China and Hong Kong, distinguishing itself from competitors like OpenAI and Google, which have restricted access to their AI products in these regions. The potential restrictions on AI software exports would add to existing limitations on Chinese firms’ access to advanced semiconductor technology, further complicating US-China relations in the tech sector.