Bottom line: Google’s campaign to build a China-based artificial intelligence team is at least partly designed to woo Beijing, as part of its broader effort to get permission to open a China-based Google Play app store.
In the latest signal of its move back to China, Internet titan Google (Nasdaq: GOOG) is apparently on a hiring spree in Beijing that looks aimed at building up an artificial intelligence (AI) team in the world’s largest online market. This particular move doesn’t come as a huge surprise, and seems to be part of Google’s recent obsession with the world’s biggest Internet market.
The backstory is that Google quit China seven years ago, at least for its core search business that is the backbone of its operations in other markets, due to a dispute over Beijing’s tough policies requiring all sites to self-police themselves for sensitive content. But over the last two or three years Google has had a change of heart, realizing it really can’t afford to ignore an Internet market that has 750 million users.
With that switch in mind, the company has been on a steady campaign to court Beijing, taking advantage of the installation a few years ago of a new company CEO who had no bad blood with China. The end game in all this, at least for now, appears to be Google’s desire to open a Chinese version of its Google Play app store to feed China’s hundreds of millions of smartphones using the Google-developed Android operating system.
But for now, let’s take a step back and review the latest headlines, which have Google on a hiring spree in Beijing, including what looks like plans to build a team of AI developers at its China headquarters. (English article) What we do know is that Google is advertising for at least five positions, and probably many more, in Beijing for people with AI backgrounds. The blog that broke the story cites company insiders saying that Google is building such a team, though Google itself was characteristically mum on its plans.
The bigger backstory to this particular twist is that Beijing leaders have become somewhat obsessed with AI these days, with the result that state-run media carry the cliched term at any opportunity and it’s become quite common even in the speech of even ordinary people. China wants desperately to develop such cutting-edge technology to move away from the low-end manufacturing that is still its bread and butter but is fast becoming impractical due to rising costs as the nation’s living standards rise.
The AI fever is certainly more than a simple catchphrase, and the likes of Internet giants Tencent (HKEx: 700) and Baidu (Nasdaq: BIDU) have both announced extensive plans to cultivate the space. Thus it would now appear that Google is falling in behind that campaign, perhaps with some intent to do some serious R&D in China, but also with the intent of playing up to this important agenda on Beijing’s list.
Such brown nosing comes at a particularly important time, since the country is getting ready to hold a major Communist Party congress next month that only occurs every five years and is the closest thing China has to a presidential election. In this case the choice of president doesn’t seem to be in doubt, but many agenda items for the next 5 years will still be discussed at the meeting, and I have no doubt AI will be high on the list.
This particular move by Google is just the latest in its slow waltz back to China. Earlier this year it wowed the country when its AlphaGo computer came to China and defeated the world’s top player of Go, an ancient Chinese board game. Before that, Google restarted a developer’s conference for makers of Android apps, after a pause of several years following the fall-out with Beijing in 2010.
I’ve predicted one too many times that Google may finally get its central goal, permission to open a China-based app store, sometime soon. Thus I’m just slightly reluctant to predict yet another date, even though I doubt it will come this year. But I still do believe that Beijing will ultimately grant Google the permission it seeks, as this pair try to re-establish a new relationship of trust following the big break-up that is fast becoming a memory.