The competition to develop A.I. is usually portrayed as a battle among Goliaths–Amazon, Facebook, Google, Microsoft, Apple, IBM in the U.S.; Baidu, Alibaba, Tencent in China. But that storyline overlooks the critical role a group of researchers with ties to Canadian universities has played in A.I.’s development. Their efforts have spawned a Montreal company that’s a would-be David in the coming fight: Element AI.
The overwhelming advantage the tech giants have in A.I., aside from money and talent, is data. Developing A.I. requires massive amounts of it, and it’s hard to compete with the millions of terabytes in the hands of the behemoths. But that’s largely consumer data. Vast amounts of proprietary corporate data lie outside the giants’ reach, and Element AI is aimed at helping companies make smart use of it. The company is also attempting to present itself as a less predatory, more ethical alternative to its outsized competitors.
Vauhini Vara profiled Element AI for the July issue of Fortune magazine. It’s today’s must read, available here. The CEO of Element AI–Jean-François Gagné—will be joining us at the Fortune Global Forum in Toronto in October. (More information here.)
Vara’s story is part of Fortune’s special report on the A.I. explosion, which Fortune editor Cliff Leaf calls “Springtime for A.I.” in his introduction to the package, here. Also worth reading: Jonathan Vanian on tackling bias in A.I., and Clay Chandler on why China has an edge in the A.I. race—in part because it doesn’t worry about the ethics of things like using facial recognition to nab miscreants.
I’m on my way to San Francisco this morning, where our CEO Initiative gets underway tonight—beginning with interviews with Apple CEO Tim Cook and author Steven Pinker. More news below.
President Donald Trump is reportedly planning new curbs on Chinese investments in the U.S. and on some technology exports to China in order to counteract the Made In China 2025 initiative that would see China become both self-sufficient and globally dominant in automated industry. U.S. industry is apparently more concerned about the blocks on tech exports than it is on the Chinese investment stuff, as that’s already tapered off dramatically. Wall Street Journal
In order to mitigate the impact of the trade war with the U.S.—and deal with a slowing economy—China’s central bank says it will reduce its reserve requirement ratio for large commercial banks by half a percentage point. The move should put more than $100 billion extra into the Chinese financial system, while avoiding the need to explicitly call it monetary easing. Some analysts say it’s a “sensible offsetting move to Trump’s trade policies,” while others note that China is running out of retaliatory options. Financial Times
GE and Advent
General Electric may soon sell its distributed power business division to private-equity outfit Advent International, per the Journal. Sources told the paper that Advent beat Cummins in an auction for the division. GE, which just fell off the Dow Jones Industrial Average, is trying to simplify its portfolio. The business being sold here makes Jenbacher and Waukesha gas engines, which are used to generate electricity in rural areas and industrial operations. WSJ
China’s Meituan-Dianping, a platform for everything from food delivery to ticketing services, reportedly aims to raise more than $4 billion in a Hong Kong IPO. Hong Kong recently started allowing companies with a dual-class share structure to file there and, following the lead of Xiaomi earlier this year, Meituan-Dianping looks set to take advantage of the shift. The Tencent-backed firm was valued at $30 billion in a round last year. Reuters
Around the Water Cooler
Surprise! Turkish strongman Recep Tayyip Erdogan, who has jailed many opponents and taken control of much of the Turkish media, has won the country’s presidential election and will now assume new levels of control over the country’s government and judiciary. Erdogan, who has ruled for the last 16 years, may still be around for the next decade. Guardian
Brexit vs. Business
The British health secretary has attacked Airbus and BMW for warning that they might pull investment from the U.K. due to the uncertainty around Brexit. Jeremy Hunt said it was “completely inappropriate for businesses to be making these kinds of threats.” “The more that we undermine Theresa May the more likely we are to end up with a fudge, which would be an absolute disaster for everyone,” he added. BBC
Brexit and the Hedge Funds
Bloomberg has a blockbuster piece on how polling companies charged hedge funds for a lucrative heads-up on the outcome of the 2016 Brexit referendum—notably Survation, run by a friend of Brexit figurehead and former commodities trader Nigel Farage. After the vote closed, Farage conceded a narrow defeat, apparently after having been privately told that the vote probably went in his favor. Whether intentional or not, Farage’s statements likely helped briefly drive the pound higher just before reality sunk in, and short-sellers made a lot of money. Bloomberg
China (lots of that today!) has blocked HBO’s website over comedian John Oliver’s mockery of President Xi Jinping. Xi is very touchy about people noting a resemblance between him and Winnie the Pooh, and Oliver went there. First the censors scrubbed mentions of Oliver from Chinese social media; then came the HBO site block. YouTube, which also carries clips of Oliver’s show, has long been blocked in China. South China Morning Post