The Real Survival Situation of Enterprises behind the Crazy AI






In the past two years, every day I see and hear a lot of AI news reports. Enterprises related to AI have sprung up like bamboo shoots after a spring rain. According to Zhang Xueli, deputy director of CITIC, Ministry of Industry and Information Technology, as of September 2018, there were 5 159 AI enterprises in the world, with China ranking second with 1122 (excluding Hong Kong, Macao and Taiwan), while Beijing ranked the largest number of AI enterprises in the world with a total of 445.



Crazy AI

Behind the crazy news coverage, the AI industry also needs the entry of capital. In the first half of 2018, global financing in the field of artificial intelligence reached 43.5 billion US dollars, and China reached 31.7 billion US dollars, accounting for more than three quarters of the world. Another beautiful victory: China only relies on 1/5 of the global enterprises to obtain 3/4 of global financing, investors are full of expectations for China's AI sector.




The Real Survival Situation of AI Enterprises

According to the media's AI landing report, in 2017, China's AI start-ups received more than 50 billion yuan of financing, but the top 100 companies in the business landings generated less than 10 billion yuan of revenue. In the whole industry chain, more than 90% of AI enterprises are still in the stage of loss, and most of them have less than 200 million annual revenue.


In view of this phenomenon, Alibaba's former CEO Wei Zhe said: at present, the bubble of artificial intelligence is immense, and the media touts it, and the market is overheating. Many companies on the market call themselves "AI" companies, but 90% of AI companies are "pseudo-AI".



Pseudo-artificial intelligence is prevalent and its practicability is poor.

Technology can not be commercialized, which is the key to AI companies being labelled as "pseudo-AI".

According to observation: Part of the reason is that enterprises over-publicize laboratory data, so that users lag behind in the actual experience; Part of the reason is that enterprises blindly imitate, lack of real innovation ability, among which face recognition technology is the most prominent. When product technology tends to be homogeneous, price war will break out at any time.



Essence of AI

What is artificial intelligence? The real connotation of artificial intelligence is "machine learning". Only when there are correct data for learning, can machines really and excellently complete certain tasks.


The four big bubbles affect the development of AI:

Technology bubble: AI is a kind of interdisciplinary and applied discipline, with a high professional threshold and a small number of truly knowledgeable people.

Capital bubble: too much capital and too many concepts, and the draught is visible. But how to stand on the draught, everyone is watching.

Business bubble: now many AI are pseudo intelligence. Most enterprises do not know how to use intelligence and data to serve customers and create value.

Valuation bubble: valuing billions is not difficult. It's hard to find profits. At present, most AI is still in the stage of technology tools, and there is still a big gap between platform and product, not to mention profitability.



The Way Out for Artificial Intelligence Enterprises

Under the capital bubble of AI enterprises, product homogenization is serious. Some enterprises do not really innovate but blindly follow suit. "Squeeze the bubble and grasp the pain point" is the only way out for AI enterprises. In this environment of survival of the fittest, AI enterprises should be down-to-earth, practice internal skills, strive for progress steadily, use data and technology to find a better way to commercialize, better serve users and realize their value.


The development of an industry also has its own ecology and laws, not just money can do a good job. It needs funds, time, talent accumulation and team culture. Cook the rice with a quick fire, and then cook the soup with a small fire.



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