Why China’s answer to Google, Baidu Inc jumped 5% last week

Alex PollakPress

Baidu was up 5% last week, and is now up more than 15% in the past few months. The press suggested this is on the back of talk of an expansion into Europe, but that’s unlikely – there are just too many hurdles against a well-entrenched Google for the stock to move up so sharply. Much more likely is the company’s expansion into artificial intelligence.

AI isn’t the same as HI – human intelligence. It’s really about the way machines can do a very specific task or group of tasks better than people, rather than being able to do all the intelligent things that people do – a question of depth, really, rather than breadth.

Specifically, learn to play chess, or the game go, both of which have already been mastered.

Or driving. Yes, we know it’s fun to point out that Tesla cars have had a few crashes on auto-pilot lately, but tragic though this is, it really isn’t the point – people have car accidents too, after all.

Early discussion about self-driving technology was partially about mapping software, and the implication that the detail required for self-driving was very much higher than what is generally available. That is true, but not the whole story, and is where AI comes in.

The breakthrough came a couple of years ago when a Google computer was able to identify cats from pictures, despite not having been told that such a thing existed.

It did this by “looking” at thousands of cat pictures on (where else) YouTube (see, they are useful). The system achieved 74.8% accuracy.

So what? So this. A computer that can recognise a cat (remembering that any single image could present an animal at an oblique angle, or in low lighting, or with varying markings, or any combination of these) can also learn what cars are, or pedestrians, and of course how to avoid them.

Given enough data and enough time, this isn’t all that hard. But the other breakthrough, and the thing that makes this truly useful, is the growth in processing power that allows this to happen really fast. Like in real time, such that a car using AI travelling at highway speed, or crawling along slowly in a built-up area, will do so safely.

I suspect that this is the real reason that Baidu jumped. The company poached the Google scientist working on AI, Andrew Ng, a few years ago, but was already well advanced. And it has been devoting significant resources to rolling out  a suite of products using AI – voice searches, facial recognition and yes, self driving cars.

Last week, it gained approval from California to test drive its cars there. One of the world’s internet pioneers, Kevin Kelly, recently said that it’s only a matter of time before a consumer brand as big as Apple or Google comes out of China.  Might it be a Chinese self driving car?

We invest in global change.

Google, one of the top ten listed US stocks, did not exist 20 years ago.

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