India would soon move from just an e-commerce and on-demand mobile app economy to one driven by technology. It will be an economy in which technology and artificial intelligence will impact every aspect of our lives
It will be a surprise if the US and China stopped their technology war. True to tradition, China has been able to resist US influence. Policy regulations and internet censorship in China have kept the US away so far. Even technology giants like Google, Facebook and Uber have failed to crack the code that would have given them a foothold in the Chinese market. Having pulled out from the Chinese market with much fanfare, Google has finally relented and begun work on building a search engine with censorship abilities, tailor-made for the Chinese authority.
There seems to be a slight shift in focus. This time, it is to India. Soon enough, Bengaluru will benefit (or not) with the Americans and Chinese coming hard at each other. The size of the Indian market or the fact that a large proportion of the Indian population is yet to join the internet club makes the country a magnet for the US and Chinese technology companies. This is a war to control the global technology scene at a scale that was unheard of until a few years ago.
One of my friends recently wrote on his Facebook account that the word for copying and learning is the same in Mandarin language. China has shown the world that execution is what matters and it has demonstrated an expertise of execution. Despite copying almost all technology business from the Silicon Valley, the Chinese have created humongous establishments in the space of technology, amongst others, which are so entrenched that supremacy of the Americans is not unparalleled anymore.
Companies in the US (like Uber) would create directional progress in technology while the Chinese equivalent would improvise, and extend the scope of that creation by adding an extra, and arguably the most important element — execution. This has helped Chinese companies in their global expansion. A testimony to this fact is that out of the top-20 technology companies of the world, nine are Chinese.
So would India become just a battleground for the Chinese BAT (Baidu, Alibaba and Tencent) and the American FAANG (Facebook, Apple, Amazon, Netflix and Google)? Or would we be able to see a few authentic Indian technology giants emerging in high-growth sectors like virtual reality, driverless cars, artificial intelligence or drones? Would we begin to see Indian VCs fund technology ventures instead of continuing to fund O2O (offline to online)? It is believed that India cannot compete on the technology sphere alone, but requires support from offline stores to create a moat around the technology business. This mindset exposes the damaging repercussions on technology IP front as Indians continue to lag far behind the Americans, Chinese and Japanese in the R&D-led patent sector.
Technology businesses are always about ‘winners take all’. Remember what happened to Snapdeal once they were no longer among the top three companies in the Indian ecommerce space? India would soon move from just an ecommerce and on-demand mobile app economy to one driven by technology. It will be an economy in which technology and artificial intelligence will impact every aspect of our lives.
While the US companies like Google, Amazon and Uber have preferred the direct route to enter the Indian market, the Chinese BAT have taken the route of investing in Indian companies (Alibaba now owns a significant part of Paytm and Paytm Cloud is most likely just a rebranding of Alibaba Cloud).
Artificial intelligence is powered by algorithm. Now algorithm needs data to train itself. Currently, no one is stopping the US and Chinese firms to use Indian biometric data to train their algorithm. The lack of access to such data is preventing Indian start-ups to build artificial intelligence systems. The Indian government has to accept artificial intelligence technology at scale to fuel the innovation in India by homegrown start-ups. This will be extremely effective moats for deep technology companies from India which would be able to generate data that their US and Chinese counterparts will not have access to. Let’s turn the table, and not allow Chinese companies to scan billions of Indian faces, shall we?
Also, an average Indian internet consumer is still naïve compared to their Western counterparts when it comes to technology literacy. Owing to such a lack of awareness, they fail to understand the consequences of sharing a photo or video on the internet. The American companies like Amazon, Microsoft, Facebook and Google should not be allowed to train their algorithm on the photos and videos shared by users, which would help those companies develop knowledge about the personal lives and activities of the users.
The Indian government has to stop playing the catch-up game and start playing an active role in safeguarding not just Indian innovations, but more importantly, Indian data. Some efforts in this direction have started, but not enough has been done. Recently a draft data protection bill has been produced by a committee headed by Justice BN Srikrishna which prevents storing of sensitive data in servers abroad.
The Indian government has still not produced a concrete policy around the handling of sensitive data, or more precisely, biometric data. Currently, no law prevents the storing of Indian biometric data in servers of China or the US. More importantly, there is no law that prohibits foreign technology firms from using Indian biometric data to train their artificial intelligence systems. So Chinese technology firms can not only use video surveillance data captured from their IP cameras installed in India, they can also use facial recognition or speech recognition data to train their artificial intelligence systems. This will not just compromise national security, but also rob the future Indian technology companies an equal opportunity to compete in their own market.
When it comes to the technology policy arena, the Chinese government has never been a mute spectator. Would the Indian government play a proactive part in technology policymaking?
(The writer is COO Asianet and an investment professional with an entrepreneurial DNA. Khare loves the intersection of investment, engineering, design, analytics, cognitive psychology and usability and passionately follows UI, UX and tech news. He is an MBA London Business School and MS Engineering from ETH Zurich.)
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