Is there a Cold War-style gap opening up between the U.S. and China over their respective generative artificial intelligence (GenAI) capabilities?

Both countries have witnessed billions of dollars of investment, with funding from corporate, governmental and institutional investors, driving innovation at breakneck speed.

But has the pace become too quick for China? Its government and delegates at last week’s National People’s Congress say not.

Bloomberg reporter Sarah Zheng was there last week and spoke to the CEO of 360 Security Technology, who told her: “China's AI companies had developed quickly and basically managed to catch up to OpenAI's ChatGPT capabilities.”

That would suggest that China is roughly on par with the U.S. in terms of AI development.

Large Language Models: U.S. vs. China

Microsoft Corporation (NASDAQ:MSFT), which is the chief backer behind OpenAI, has licensed its partner’s developments in large language models and generative artificial intelligence (GenAI) to take, what many analysts feel, is the leading position in the U.S. AI industry.

Brad Reback, analyst at Stifel, said this of Microsoft last month: “We believe its increasing GenAI scale will become ...

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