This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

Whether you’ve flown a drone before or not, you’ve probably heard of DJI, or at least seen its logo. With more than a 90% share of the global consumer market, this Shenzhen-based company’s drones are used by hobbyists and businesses alike for photography and surveillance, as well as for spraying pesticides, moving parcels, and many other purposes around the world.  

But on June 14, the US House of Representatives passed a bill that would completely ban DJI’s drones from being sold in the US. The bill is now being discussed in the Senate as part of the annual defense budget negotiations. 

The reason? While its market dominance has attracted scrutiny for years, it’s increasingly clear that DJI’s commercial products are so good and affordable they are also being used on active battlefields to scout out the enemy or carry bombs. As the US worries about the potential for conflict between China and Taiwan, the military implications of DJI’s commercial drones are becoming a top policy concern.

DJI has managed to set the gold standard for commercial drones because it is built on decades of electronic manufacturing prowess and policy support in Shenzhen. It is an example of how China’s manufacturing advantage can turn into a technological one.

“I’ve been to the DJI factory many times … and mainly, China’s industrial base is so deep that every component ends up being a fraction of the cost,” Sam Schmitz, the mechanical engineering lead at Neuralink, wrote on X. Shenzhen and surrounding towns have had a robust factory scene for decades, providing an indispensable supply chain for a hardware industry like drones. “This factory made almost everything, and it’s surrounded by thousands of factories that make everything else … nowhere else in the world can you run out of some weird screw and just walk down the street until you find someone selling thousands of them,” he wrote.

But Shenzhen’s municipal government has also significantly contributed to the industry. For example, it has granted companies more permission for potentially risky experiments and set up subsidies and policy support. Last year, I visited Shenzhen to experience how it’s already incorporating drones in everyday food delivery, but the city is also working with companies to use drones for bigger and bigger jobs—carrying everything from packages to passengers. All of these go into a plan to build up the “low-altitude economy” in Shenzhen that keeps the city on the leading edge of drone technology.

As a result, the supply chain in Shenzhen has become so competitive that the world can’t really use drones without it. Chinese drones are simply the most accessible and affordable out there. 

Most recently, DJI’s drones have been used by both sides in the Ukraine-Russia conflict for reconnaissance and bombing. Some American companies tried to replace DJI’s role, but their drones were more expensive and their performance unsatisfactory. And even as DJI publicly suspended its businesses in Russia and Ukraine and said it would terminate any reseller relationship if its products were found to be used for military purposes, the Ukrainian army is still assembling its own drones with parts sourced from China.

This reliance on one Chinese company and the supply chain behind it is what worries US politicians, but the danger would be more pronounced in any conflict between China and Taiwan, a prospect that is a huge security concern in the US and globally.

Last week, my colleague James O’Donnell wrote about a report by the think tank Center for a New American Security (CNAS) that analyzed the role of drones in a potential war in the Taiwan Strait. Right now, both Ukraine and Russia are still finding ways to source drones or drone parts from Chinese companies, but it’d be much harder for Taiwan to do so, since it would be in China’s interest to block its opponent’s supply. “So Taiwan is effectively cut off from the world’s foremost commercial drone supplier and must either make its own drones or find alternative manufacturers, likely in the US,” James wrote.

If the ban on DJI sales in the US is eventually passed, it will hit the company hard for sure, as the US drone market is currently worth an estimated $6 billion, the majority of which is going to DJI. But undercutting DJI’s advantage won’t magically grow an alternative drone industry outside China. 

“The actions taken against DJI suggest protectionism and undermine the principles of fair competition and an open market. The Countering CCP Drones Act risks setting a dangerous precedent, where unfounded allegations dictate public policy, potentially jeopardizing the economic well-being of the US,” DJI told MIT Technology Review in an emailed statement.

The Taiwanese government is aware of the risks of relying too much on China’s drone industry, and it’s looking to change. In March, Taiwan’s newly elected president, Lai Ching-te, said that Taiwan wants to become the “Asian center for the democratic drone supply chain.” 

Already the hub of global semiconductor production, Taiwan seems well positioned to grow another hardware industry like drones, but it will probably still take years or even decades to build the economies of scale seen in Shenzhen. With support from the US, can Taiwanese companies really grow fast enough to meaningfully sway China’s control of the industry? That’s a very open question.

A housekeeping note: I’m currently visiting London, and the newsletter will take a break next week. If you are based in the UK and would like to meet up, let me know by writing to zeyi@technologyreview.com.

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Catch up with China

1. ByteDance is working with the US chip design company Broadcom to develop a five-nanometer AI chip. This US-China collaboration, which should be compliant with US export restrictions, is rare these days given the political climate. (Reuters $)

2. After both the European Union and China announced new tariffs against each other, the two sides agreed to chat about how to resolve the dispute. (New York Times $)

• Canada is preparing to announce its own tariffs on Chinese-made electric vehicles. (Bloomberg $)

3. A NASA leader says the US is “on schedule” to send astronauts to the moon within a few years. There’s currently a heated race between the US and China on moon exploration. (Washington Post $)

4. A new cybersecurity report says RedJuliett, a China-backed hacker group, has intensified attacks on Taiwanese organizations this year. (Al Jazeera $)

5. The Canadian government is blocking a rare earth mine from being sold to a Chinese company. Instead, the government will buy the stockpiled rare earth materials for $2.2 million. (Bloomberg $)

6. Economic hardship at home has pushed some Chinese small investors to enter the US marijuana industry. They have been buying lands in the States, setting up marijuana farms, and hiring other new Chinese immigrants. (NPR)

Lost in translation

In the past week, the most talked-about person in China has been a 17-year-old girl named Jiang Ping, according to the Chinese publication Southern Metropolis Daily. Every year since 2018, the Chinese company Alibaba has been hosting a global mathematics contest that attracts students from prestigious universities around the world to compete for a generous prize. But to everyone’s surprise, Jiang, who’s studying fashion design at a vocational high school in a poor town in eastern China, ended up ranking 12th in the qualifying round this year, beating scores of college undergraduate or even master’s students. Other than reading college mathematics textbooks under her math teacher’s guidance, Jiang has received no professional training, as many of her competitors have.

Jiang’s story, highlighted by Alibaba following the announcement of the first-round results, immediately went viral in China. While some saw it as a tale of buried talents and how personal endeavor can overcome unfavorable circumstances, others questioned the legitimacy of her results. She became so famous that people, including social media influencers, kept visiting her home, turning her hometown into an unlikely tourist destination. The town had to hide Jiang from public attention while she prepared for the final round of the competition.

One more thing

After I wrote about the new Chinese generative video model Kling last week, the AI tool added a new feature that can turn a static photo into a short video clip. Well, what better way to test its performance than feeding it the iconic “distracted boyfriend” meme and watching what the model predicts will happen after that moment?

可灵上线图生视频了，演绎效果很到位！ pic.twitter.com/MgcO3CCl9o

— Gorden Sun (@Gorden_Sun) June 21, 2024

Update: The story has been updated to include a statement from DJI.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

You may not be familiar with Kuaishou, but this Chinese company just hit a major milestone: It’s released the first text-to-video generative AI model that’s freely available for the public to test.

The short-video platform, which has over 600 million active users, announced the new tool on June 6. It’s called Kling. Like OpenAI’s Sora model, Kling is able to generate videos “up to two minutes long with a frame rate of 30fps and video resolution up to 1080p,” the company says on its website.

But unlike Sora, which still remains inaccessible to the public four months after OpenAI trialed it, Kling soon started letting people try the model themselves. 

I was one of them. I got access to it after downloading Kuaishou’s video-editing tool, signing up with a Chinese number, getting on a waitlist, and filling out an additional form through Kuaishou’s user feedback groups. The model can’t process prompts written entirely in English, but you can get around that by either translating the phrase you want to use into Chinese or including one or two Chinese words.

So, first things first. Here are a few results I generated with Kling to show you what it’s like. Remember Sora’s impressive demo video of Tokyo’s street scenes or the cat darting through a garden? Here are Kling’s takes:

ZEYI YANG/MIT TECHNOLOGY REVIEW | KLING

ZEYI YANG/MIT TECHNOLOGY REVIEW | KLING

ZEYI YANG/MIT TECHNOLOGY REVIEW | KLING

Remember the image of Dall-E’s horse-riding astronaut? I asked Kling to generate a video version too. 

ZEYI YANG/MIT TECHNOLOGY REVIEW | KLING

There are a few things worth applauding here. None of these videos deviates from the prompt much, and the physics seem right—the panning of the camera, the ruffling leaves, and the way the horse and astronaut turn, showing Earth behind them. The generation process took around three minutes for each of them. Not the fastest, but totally acceptable. 

But there are obvious shortcomings, too. The videos, while 720p in format, seem blurry and grainy; sometimes Kling ignores a major request in the prompt; and most important, all videos generated now are capped at five seconds long, which makes them far less dynamic or complex.

However, it’s not really fair to compare these results with things like Sora’s demos, which are hand-picked by OpenAI to release to the public and probably represent better-than-average results. These Kling videos are from the first attempts I had with each prompt, and I rarely included prompt-engineering keywords like “8k, photorealism” to fine-tune the results. 

If you want to see more Kling-generated videos, check out this handy collection put together by an open-source AI community in China, which includes both impressive results and all kinds of failures.

Kling’s general capabilities are good enough, says Guizang, an AI artist in Beijing who has been testing out the model since its release and has compiled a series of direct comparisons between Sora and Kling. Kling’s disadvantage lies in the aesthetics of the results, he says, like the composition or the color grading. “But that’s not a big issue. That can be fixed quickly,” Guizang, who wished to be identified only by his online alias, tells MIT Technology Review. 

“The core capability of a model is in how it simulates physics and real natural environments,” and he says Kling does well in that regard.

Kling works in a similar way to Sora: it combines the diffusion models traditionally used in video-generation AIs with a transformer architecture, which helps it understand larger video data files and generate results more efficiently.

But Kling may have a key advantage over Sora: Kuaishou, the most prominent rival to Douyin in China, has a massive video platform with hundreds of millions of users who have collectively uploaded an incredibly big trove of video data that could be used to train it. Kuaishou told MIT Technology Review in a statement that “Kling uses publicly available data from the global internet for model training, in accordance with industry standards.” However, the company didn’t elaborate on the specifics of the training data(neither did OpenAI about Sora, which has led to concerns about intellectual-property protections).

After testing the model, I feel the biggest limitation to Kling’s usefulness is that it only generates five-second-long videos.

“The longer a video is, the more likely it will hallucinate or generate inconsistent results,” says Shen Yang, a professor studying AI and media at Tsinghua University in Beijing. That limitation means the technology will leave a larger impact on the short-video industry than it does on the movie industry, he says. 

Short, vertical videos (those designed for viewing on phones) usually grab the attention of viewers in a few seconds. Shen says Chinese TikTok-like platforms often assess whether a video is successful by how many people would watch through the first three or five seconds before they scroll away—so an AI-generated high-quality video clip that’s just five seconds long could be a game-changer for short-video creators. 

Guizang agrees that AI could disrupt the content-creating scene for short-form videos. It will benefit creators in the short term as a productivity tool; but in the long run, he worries that platforms like Kuaishou and Douyin could take over the production of videos and directly generate content customized for users, reducing the platforms’ reliance on star creators.

It might still take quite some time for the technology to advance to that level, but the field of text-to-video tools is getting much more buzzy now. One week after Kling’s release, a California-based startup called Luma AI also released a similar model for public usage. Runway, a celebrity startup in video generation, has teased a significant update that will make its model much more powerful. ByteDance, Kuaishou’s biggest rival, is also reportedly working on the release of its generative video tool soon. “By the end of this year, we will have a lot of options available to us,” Guizang says.

I asked Kling to generate what society looks like when “anyone can quickly generate a video clip based on their own needs.” And here’s what it gave me. Impressive hands, but you didn’t answer the question—sorry.

ZEYI YANG/MIT TECHNOLOGY REVIEW | KLING

Do you have a prompt you want to see generated with Kling? Send it to zeyi@technologyreview.com and I’ll send you back the result. The prompt has to be less than 200 characters long, and preferably written in Chinese.

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Catch up with China

1. A new investigation revealed that the US military secretly ran a campaign to post anti-vaccine propaganda on social media in 2020 and 2021, aiming to sow distrust in the Chinese-made covid vaccines in Southeast Asian countries. (Reuters $)

2. A Chinese court sentenced Huang Xueqin, the journalist who helped launch the #MeToo movement in China, to five years in prison for “inciting subversion of state power.” (Washington Post $)

3. A Shein executive said the company’s corporate values basically make it an American company, but the company is now trying to hide that remark to avoid upsetting Beijing. (Financial Times $)

4. China is getting close to building the world’s largest particle collider, potentially starting in 2027. (Nature)

5. To retaliate for the European Union’s raising tariffs on electric vehicles, the Chinese government has opened an investigation into allegedly unfair subsidies for Europe’s pork exports. (New York Times $)

• On a related note about food: China’s exploding demand for durian fruit in recent years has created a $6 billion business in Southeast Asia, leading some farmers to cut down jungles and coffee plants to make way for durian plantations. (New York Times $)

Lost in translation

In 2012, Jiumei, a Chinese woman in her 20s, began selling a service where she sends “good night” text messages to people online at the price of 1 RMB per text (that’s about $0.14). 

Twelve years, three mobile phones, four different numbers, and over 50,000 messages later, she’s still doing it, according to the Chinese online publication Personage. Some of her clients are buying the service for themselves, hoping to talk to someone regularly at their most lonely or desperate times. Others are buying it to send anonymous messages—to a friend going through a hard time, or an ex-lover who has cut off communications. 

The business isn’t very profitable. Jiumei earns around 3,000 RMB ($410) annually from it on top of her day job, and even less in recent years. But she’s persisted because the act of sending these messages has become a nightly ritual—not just for her customers but also for Jiumei herself, offering her solace in her own times of loneliness and hardship.

One more thing

Globally, Kuaishou has been much less successful than its nemesis ByteDance, except in one country: Brazil. Kwai, the overseas version of Kuaishou, has been so popular in Brazil that even the Marubo people, a tribal group in the remote Amazonian rainforests and one of the last communities to be connected online, have begun using the app, according to the New York Times.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

If you’ve ever been to Taiwan, you’ve likely run into Gogoro’s green-and-white battery-swap stations in one city or another. With 12,500 stations around the island, Gogoro has built a sweeping network that allows users of electric scooters to drop off an empty battery and get a fully charged one immediately. Gogoro is also found in China, India, and a few other countries.
 
This morning, I published a story on how Gogoro’s battery-swap network in Taiwan reacted to emergency blackouts after the 7.4 magnitude earthquake there this April. I talked to Horace Luke, Gogoro’s cofounder and CEO, to understand how in three seconds, over 500 Gogoro battery-swap locations stopped drawing electricity from the grid, helping stabilize the power frequency.
 
Gogoro’s battery stations acted like something called a virtual power plant (VPP), a new idea that’s becoming adopted around the world as a way to stitch renewable energy into the grid. The system draws energy from distributed sources like battery storage or small rooftop solar panels and coordinates those sources to increase supply when electricity demand peaks. As a result, it reduces the reliance on traditional coal or gas power plants.
 
There’s actually a natural synergy between technologies like battery swapping and virtual power plants (VPP). Not only can battery-swap stations coordinate charging times with the needs of the grid, but the idle batteries sitting in Gogoro’s stations can also become an energy reserve in times of emergency, potentially feeding energy back to the grid. If you want to learn more about how this system works, you can read the full story here.

When I talked to Gogoro’s Luke for this story, I asked him: “At what point in the company’s history did you come up with the idea to use these batteries for VPP networks?”
 
To my surprise, Luke answered: “Day one.”
 
As he explains, Gogoro was actually not founded to be an electric-scooter company; it was founded to be a “smart energy” company. 

“We started with the thesis of how smart energy, through portability and connectivity, can enable many use case scenarios,” Luke says. “Transportation happens to be accounting for something like 27% or 28% of your energy use in your daily life.” And that’s why the company first designed the batteries for two-wheeled vehicles, a popular transportation option in Taiwan and across Asia.
 
Having succeeded in promoting its scooters and the battery-swap charging method in Taiwan, it is now able to explore other possible uses of these modular, portable batteries—more than 1.4 million of which are in circulation at this point. 
 
“Think of smart, portable, connected energy like a propane tank,” Luke says. Depending on their size,  propane tanks can be used to cook in the wild or to heat a patio. If lithium batteries can be modular and portable in a similar way, they can also serve many different purposes.

Using them in VPP programs that protect the grid from blackouts is one; beyond that, in Taipei City, Gogoro has worked with the local government to build energy backup stations for traffic lights, using the same batteries to keep the lights running in future blackouts. The batteries can also be used as backup power storage for critical facilities like hospitals. When a blackout happens, battery storage can release electricity much faster than diesel generators, keeping the impact at a minimum.

None of this would be possible without the recent advances that have made batteries more powerful and efficient. And it was clear from our conversation that Luke is obsessed with batteries—the long way the technology has come, and their potential to address a lot more energy use cases in the future.

“I still remember getting my first flashlight when I was a little kid. That button just turned the little lightbulb on and off. And that was what was amazing about batteries at the time,” says Luke. “Never did people think that AA batteries were going to power calculators or the Walkman. The guy that invented the alkaline battery never thought that. We’ll continue to take that creativity and apply it to portable energy, and that’s what inspires us every day.”

What other purposes do you think portable lithium batteries like the ones made by Gogoro could have? Let me know your ideas by writing to zeyi@technologyreview.com.

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Catch up with China

1. Far-right parties won big in the latest European Parliament elections, which could push the EU further toward a trade war with China. (Nikkei Asia $)
 
2. Volvo has started moving some of its manufacturing capacity from China to Belgium in order to avoid the European Union tariffs on Chinese imports. (The Times $)
 
3. Some major crypto exchanges have withdrawn from applying for business licenses in Hong Kong after the city government clarified that it doesn’t welcome businesses that offer crypto services to mainland China. (South China Morning Post $)
 
4. NewsBreak, the most downloaded news app in the US, does most of its engineering work in China. The app has also been found to use AI tools to make up local news that never happened. (Reuters $)
 
5. The Australian government ordered a China-linked fund to reduce its investment in an Australian rare-earth-mining company. (A/symmetric)
 
6. China just installed the largest offshore wind turbine in the world. It’s designed to generate enough power in a year for around 36,000 households. (Electrek)
 
7. Four college instructors from Iowa were stabbed on a visit to northern China. While the motive and identity of the assailant are still unknown, the incident has been quickly censored on the Chinese internet. (BBC)

Lost in translation

Qian Zhimin, a Chinese businesswoman who fled the country in 2017 after raising billions of dollars from Chinese investors in the name of bitcoin investments, was arrested in London and is facing a trial in October this year, according to the Chinese publication Caijing. In the early 2010s, when the cryptocurrency first became known in China, Qian’s company lured over 128,000 retail investors, predominantly elderly people, to buy fraudulent investment products that bet on the price of bitcoins and gadgets like smart bracelets that allegedly could also mine bitcoins. 
 
After the scam was exposed, Qian escaped to the UK with a fake passport. She controls over 61,000 bitcoins, now worth nearly $4 billion, and has been trying to liquidate them by buying properties in London. But those attempts caught the attention of anti-money-laundering authorities in the UK. With her trial date approaching, the victims in China are hoping to work with the UK jurisdiction to recover their assets.

One more thing

I know one day we will see self-driving vehicles racing each other and cutting each other off, but I didn’t expect it to happen so soon with two package delivery robots in China. Maybe it’s just their look, but it seems cuter than when human drivers do the same thing?

TBH, I was expecting a world where unmanned delivery vehicles racing each other on busy streets to come maybe 5 yrs from now, but JD & its subsidiary Dada are making it happen w/o hitting anything

RIP to China's delivery ppl pic.twitter.com/Ae1Wy4mWAj

— tphuang (@tphuang) June 9, 2024

On the morning of April 3, Taiwan was hit by a 7.4 magnitude earthquake. Seconds later, hundreds of battery-swap stations in Taiwan sensed something else: the power frequency of the electric grid took a sudden drop, a signal that some power plants had been disconnected in the disaster. The grid was now struggling to meet energy demand. 

These stations, built by the Taiwanese company Gogoro for electric-powered two-wheeled vehicles like scooters, mopeds, and bikes, reacted immediately. According to numbers provided by the company, 590 Gogoro battery-swap locations (some of which have more than one swap station) stopped drawing electricity from the grid, lowering local demand by a total six megawatts—enough to power thousands of homes. It took 12 minutes for the grid to recover, and the battery-swap stations then resumed normal operation.

Gogoro is not the only company working on battery-swapping for electric scooters (New York City recently launched a pilot program to give delivery drivers the option to charge this way), but it’s certainly one of the most successful. Founded in 2011, the firm has a network of over 12,500 stations across Taiwan and boasts over 600,000 monthly subscribers who pay to swap batteries in and out when required. Each station is roughly the size of two vending machines and can hold around 30 scooter batteries.

Now the company is putting the battery network to another use: Gogoro has been working with Enel X, an Italian company, to incorporate the stations into a virtual power plant (VPP) system that helps the Taiwanese grid stay more resilient in emergencies like April’s earthquake. 

Battery-swap stations work well for VPP programs because they offer so much more flexibility than charging at home, where an electric-bike owner usually has just one or two batteries and thus must charge immediately after one runs out. With dozens of batteries in a single station as a demand buffer, Gogoro can choose when it charges them—for instance, doing so at night when there’s less power demand and it’s cheaper. In the meantime, the batteries can give power back to the grid when it is stressed—hence the comparison to power plants.

“What is beautiful is that the stations’ economic interest is aligned with the grid—the [battery-swap companies] have the incentive to time their charges during the low utilization period, paying the low electricity price, while feeding electricity back to the grid during peak period, enjoying a higher price,” says S. Alex Yang, a professor of management science at London Business School. 

Gogoro is uniquely positioned to become a vital part of the VPP network because “there’s a constant load in energy, and then at the same time, we’re on standby that we can either stop taking or giving back [power] to the grid to provide stability,” Horace Luke, cofounder and CEO of Gogoro, tells MIT Technology Review. 

Luke estimates that only 90% of Gogoro batteries are actually on the road powering scooters at any given time, so the rest, sitting on the racks waiting for customers to pick up, become a valuable resource that can be utilized by the grid. 

Today, out of the 2,500 Gogoro locations, over 1,000 are part of the VPP program. Gogoro promises that the system will automatically detect emergencies and, in response, immediately lower its consumption by a certain total amount.

Which stations get included in the VPP depends on where they are and how much capacity they have. A smaller station right outside a metro stop—meaning high demand and low supply—probably can’t afford to stop charging during an emergency because riders could come looking for a battery soon. But a megastation with 120 batteries in a residential area is probably safe to stop charging batteries for a while.

Plus, the entire station doesn’t go dark—Gogoro has a built-in system that decides which or how many batteries in a station stop charging. “We know exactly which batteries to spin down, which station to spin down, how much to spin down,” says Luke. “That was all calculated in real time in the back side of the server.” It can even consolidate the power left in several batteries into one, so a customer who comes in can still leave with a fully charged battery even if the whole system is operating below capacity.

The earthquake and its aftermath in Taiwan this year put the VPP stations to the test—but also showed the system’s strength. On April 15, 12 days after the initial earthquake, the grid in Taiwan was still recovering from the damage when another power drop happened. This time, 818 Gogoro locations reacted in five seconds, reducing power consumption by 11 megawatts for 30 minutes.

Numbers like 6 MW and 11 MW are “not a trivial amount of power but still substantially smaller than a centralized power plant,” says Joshua Pearce, an engineering professor at Western University in Ontario, Canada. For comparison, Taiwan lost 3,200 MW of power supply right after the April earthquake, and the gap was mostly filled by solar power, centralized battery storage, and hydropower. But the entire Taiwanese VPP network combined, which has reached a capacity of 1,350 MW, can make a significant difference. “It helps the grid maintain stability during disasters. The more smart loads there are on the grid, the more resilient it is,” he says. 

However, the potential of these battery-swap stations has not been fully achieved yet; the majority of the stations have not started giving energy back to the grid. 

“The tech system is ready, but the business and economics are not ready,” Luke says. There are 10 Gogoro battery-swapping stations that can return electricity to the grid in a pilot program, but other stations haven’t received the technological update. 

Upgrading stations to bi-directional charging makes economic sense only if Gogoro can profit from selling the electricity back. While the Taiwanese state-owned utility company currently allows private energy generators like solar farms to sell electricity to the grid at a premium, it hasn’t allowed battery-storage companies like Gogoro to do so. 

This challenge is not unique to Taiwan. Incorporating technologies like VPP requires making fundamental changes to the grid, which won’t happen without policy support. “The technology is there, but the practices are being held back by antiquated utility business models where they provide all electric services,” says Pearce. “Fair policies are needed to allow solar energy and battery owners to participate in the electric market for the best interest of all electricity consumers.”

Correction: The story has been updated to clarify that 90%, not 10%, of Gogoro’s batteries are on the road.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

Have you ever thought about the miraculous fact that despite the myriad differences between languages, virtually everyone uses the same QWERTY keyboards? Many languages have more or fewer than 26 letters in their alphabet—or no “alphabet” at all, like Chinese, which has tens of thousands of characters. Yet somehow everyone uses the same keyboard to communicate.

Last week, MIT Technology Review published an excerpt from a new book, The Chinese Computer, which talks about how this problem was solved in China. After generations of work to sort Chinese characters, modify computer parts, and create keyboard apps that automatically predict the next character, it is finally possible for any Chinese speaker to use a QWERTY keyboard. 

But the book doesn’t stop there. It ends with a bigger question about what this all means: Why is it necessary for speakers of non-Latin languages to adapt modern technologies for their uses, and what do their efforts contribute to computing technologies?

I talked to the book’s author, Tom Mullaney, a professor of history at Stanford University. We ended up geeking out over keyboards, computers, the English-centric design that underlies everything about computing, and even how keyboards affect emerging technologies like virtual reality. Here are some of his most fascinating answers, lightly edited for clarity and brevity. 

Mullaney’s book covers many experiments across multiple decades that ultimately made typing Chinese possible and efficient on a QWERTY keyboard, but a similar process has played out all around the world. Many countries with non-Latin languages had to work out how they could use a Western computer to input and process their own languages.

Mullaney: In the Chinese case—but also in Japanese, Korean, and many other non-Western writing systems—this wasn’t done for fun. It was done out of brute necessity because the dominant model of keyboard-based computing, born and raised in the English-speaking world, is not compatible with Chinese. It doesn’t work because the keyboard doesn’t have the necessary real estate. And the question became: I have a few dozen keys but 100,000 characters. How do I map one onto the other? 

Simply put, half of the population on Earth uses the QWERTY keyboard in ways the QWERTY keyboard was never intended to be used, creating a radically different way of interacting with computers.

The root of all of these problems is that computers were designed with English as the default language. So the way English works is just the way computers work today.

The English modularity is so fundamental in computing that non-Latin speakers are still grappling with the impacts today despite decades of hard work to change things.

Mullaney shared a complaint that Arabic speakers made in 2022 about Adobe InDesign, the most popular publishing design software. As recently as two years ago, pasting a string of Arabic text into the software could cause the text to become messed up, misplacing its diacritic marks, which are crucial for indicating phonetic features of the text. It turns out you need to install a Middle East version of the software and apply some deliberate workarounds to avoid the problem.

M: Latin alphabetic dominance is still alive and well; it has not been overthrown. And there’s a troubling question as to whether it can ever be overthrown. Some turn was made, some path taken that advantaged certain writing systems at a deep structural level and disadvantaged others. 

That deeply rooted English-centric design is why mainstream input methods never deviate too far from the keyboards that we all know and love/hate. In the English-speaking world, there have been numerous attempts to reimagine the way text input works. Technologies such as the T9 phone keyboard or the Palm Pilot handwriting alphabet briefly achieved some adoption. But they never stick for long because most developers snap back to QWERTY keyboards at the first opportunity.

M: T9 was born in the context of disability technology and was incorporated into the first mobile phones because button real estate was a major problem (prior to the BlackBerry reintroducing the QWERTY keyboard). It was a necessity; [developers] actually needed to think in a different way. But give me enough space, give me 12 inches by 14 inches, and I’ll default to a QWERTY keyboard.

Every 10 years or so, some Western tech company or inventor announces: “Everybody! I have finally figured out a more advanced way of inputting English at much higher speeds than the QWERTY keyboard.” And time and time again there is zero market appetite. 

Will the QWERTY keyboard stick around forever? After this conversation, I’m secretly hoping it won’t. Maybe it’s time for a change. With new technologies like VR headsets, and other gadgets on the horizon, there may come a time when QWERTY keyboards are not the first preference, and non-Latin languages may finally have a chance in shaping the new norm of human-computer interactions. 

M: It’s funny, because now as you go into augmented and virtual reality, Silicon Valley companies are like, “How do we overcome the interface problem?” Because you can shrink everything except the QWERTY keyboard. And what Western engineers fail to understand is that it’s not a tech problem—it’s a technological cultural problem. And they just don’t get it. They think that if they just invent the tech, it is going to take off. And thus far, it never has.

If I were a software or hardware developer, I would be hanging out in online role-playing games, just in the chat feature; I would be watching people use their TV remote controls to find the title of the film they’re looking for; I would look at how Roblox players chat with each other. It’s going to come from some arena outside the mainstream, because the mainstream is dominated by QWERTY.

What are other signs of the dominance of English in modern computing? I’d love to hear about the geeky details you’ve noticed. Send them to zeyi@technologyreview.com.

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Catch up with China

1. Today marks the 35th anniversary of the student protests and subsequent massacre in Tiananmen Square in Beijing. 

• For decades, Hong Kong was the hub for Tiananmen memorial events. That’s no longer the case, due to Beijing’s growing control over the city’s politics after the 2019 protests. (New Yorker $)
• To preserve the legacy of the student protesters at Tiananmen, it’s also important to address ethical questions about how American universities and law enforcement have been treating college protesters this year. (The Nation)

2. A Chinese company that makes laser sensors was labeled by the US government as a security concern. A few months later, it discreetly rebranded as a Michigan-registered company called “American Lidar.” (Wall Street Journal $)

3. It’s a tough time to be a celebrity in China. An influencer dubbed “China’s Kim Kardashian” for his extravagant displays of wealth has just been banned by multiple social media platforms after the internet regulator announced an effort to clear out “​​ostentatious personas.” (Financial Times $)

• Meanwhile, Taiwanese celebrities who also have large followings in China are increasingly finding themselves caught in political crossfires. (CNN)

4. Cases of Chinese students being rejected entry into the US reveals divisions within the Biden administration. Customs agents, who work for the Department of Homeland Security, have canceled an increasing number of student visas that had already been approved by the State Department. (Bloomberg $)

5. Palau, a small Pacific island nation that’s one of the few countries in the world that recognizes Taiwan as a sovereign country, says it is under cyberattack by China. (New York Times $)

6. After being the first space mission to collect samples from the moon’s far side, China’s Chang’e-6 lunar probe has begun its journey back to Earth. (BBC)

7. The Chinese government just set up the third and largest phase of its semiconductor investment fund to prop up its domestic chip industry. This one’s worth $47.5 billion. (Bloomberg $)

• In 2022, the fund was rocked by corruption charges. (MIT Technology Review)

Lost in translation

The Chinese generative AI community has been stirred up by the first discovery of a Western large language model plagiarizing a Chinese one, according to the Chinese publication PingWest. 

Last week, two undergraduate computer science students at Stanford University released an open-source model called Llama 3-V that they claimed is more powerful than LLMs made by OpenAI and Google, while costing less. But Chinese AI researchers soon found out that Llama 3-V had copied the structure, configuration files, and code from MiniCPM-Llama3-V 2.5, another open-source LLM developed by China’s Tsinghua University and ModelBest Inc, a Chinese startup. 

What proved the plagiarism was the fact that the Chinese team secretly trained the model on a collection of Chinese writings on bamboo slips from 2000 years ago, and no other LLMs can recognize the Chinese characters in this ancient writing style accurately. But Llama 3-V could recognize these characters as well as MiniCPM, while making the exact same mistakes as the Chinese model. The students who released Llama 3-V have removed the model and apologized to the Chinese team, but the incident is seen as proof of the rapidly improving capabilities of homegrown LLMs by the Chinese AI community. 

One more thing

Hand-crafted squishy toys (or pressure balls) in the shape of cute animals or desserts have become the latest viral products on Chinese social media. Made in small quantities and sold in limited batches, some of them go for up to $200 per toy on secondhand marketplaces. I mean, they are cute for sure, but I’m afraid the idea of spending $200 on a pressure ball only increases my anxiety.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

Last week’s release of GPT-4o, a new AI “omnimodel” that you can interact with using voice, text, or video, was supposed to be a big moment for OpenAI. But just days later, it feels as if the company is in big trouble. From the resignation of most of its safety team to Scarlett Johansson’s accusation that it replicated her voice for the model against her consent, it’s now in damage-control mode. 

Add to that another thing OpenAI fumbled with GPT-4o: the data it used to train its tokenizer—a tool that helps the model parse and process text more efficiently—is polluted by Chinese spam websites. As a result, the model’s Chinese token library is full of phrases related to pornography and gambling. This could worsen some problems that are common with AI models: hallucinations, poor performance, and misuse. 

I wrote about it on Friday after several researchers and AI industry insiders flagged the problem. They took a look at GPT-4o’s public token library, which has been significantly updated with the new model to improve support of non-English languages, and saw that more than 90 of the 100 longest Chinese tokens in the model are from spam websites. These are phrases like “_free Japanese porn video to watch,” “Beijing race car betting,” and “China welfare lottery every day.”

Anyone who reads Chinese could spot the problem with this list of tokens right away. Some such phrases inevitably slip into training data sets because of how popular adult content is online, but for them to account for 90% of the Chinese language used to train the model? That’s alarming.

“It’s an embarrassing thing to see as a Chinese person. Is that just how the quality of the [Chinese] data is? Is it because of insufficient data cleaning or is the language just like that?” says Zhengyang Geng, a PhD student in computer science at Carnegie Mellon University. 

It could be tempting to draw a conclusion about a language or a culture from the tokens OpenAI chose for GPT-4o. After all, these are selected as commonly seen and significant phrases from the respective languages. There’s an interesting blog post by a Hong Kong–based researcher named Henry Luo, who queried the longest GPT-4o tokens in various different languages and found that they seem to have different themes. While the tokens in Russian reflect language about the government and public institutions, the tokens in Japanese have a lot of different ways to say “thank you.”

But rather than reflecting the differences between cultures or countries, I think this explains more about what kind of training data is readily available online, and the websites OpenAI crawled to feed into GPT-4o.

After I published the story, Victor Shih, a political science professor at the University of California, San Diego, commented on it on X: “When you try not [to] train on Chinese state media content, this is what you get.”

It’s half a joke, and half a serious point about the two biggest problems in training large language models to speak Chinese: the readily available data online reflects either the “official,” sanctioned way of talking about China or the omnipresent spam content that drowns out real conversations.

In fact, among the few long Chinese tokens in GPT-4o that aren’t either pornography or gambling nonsense, two are “socialism with Chinese characteristics” and “People’s Republic of China.” The presence of these phrases suggests that a significant part of the training data actually is from Chinese state media writings, where formal, long expressions are extremely common.

OpenAI has historically been very tight-lipped about the data it uses to train its models, and it probably will never tell us how much of its Chinese training database is state media and how much is spam. (OpenAI didn’t respond to MIT Technology Review’s detailed questions sent on Friday.)

But it is not the only company struggling with this problem. People inside China who work in its AI industry agree there’s a lack of quality Chinese text data sets for training LLMs. One reason is that the Chinese internet used to be, and largely remains, divided up by big companies like Tencent and ByteDance. They own most of the social platforms and aren’t going to share their data with competitors or third parties to train LLMs. 

In fact, this is also why search engines, including Google, kinda suck when it comes to searching in Chinese. Since WeChat content can only be searched on WeChat, and content on Douyin (the Chinese TikTok) can only be searched on Douyin, this data is not accessible to a third-party search engine, let alone an LLM. But these are the platforms where actual human conversations are happening, instead of some spam website that keeps trying to draw you into online gambling.

The lack of quality training data is a much bigger problem than the failure to filter out the porn and general nonsense in GPT-4o’s token-training data. If there isn’t an existing data set, AI companies have to put in significant work to identify, source, and curate their own data sets and filter out inappropriate or biased content. 

It doesn’t seem OpenAI did that, which in fairness makes some sense, given that people in China can’t use its AI models anyway. 

Still, there are many people living outside China who want to use AI services in Chinese. And they deserve a product that works properly as much as speakers of any other language do. 

How can we solve the problem of the lack of good Chinese LLM training data? Tell me your idea at zeyi@technologyreview.com.

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Now read the rest of China Report

Catch up with China

1. China launched an anti-dumping investigation into imports of polyoxymethylene copolymer—a widely used plastic in electronics and cars—from the US, the EU, Taiwan, and Japan. It’s widely seen as a response to the new US tariff announced on Chinese EVs. (BBC)

• Meanwhile, Latin American countries, including Mexico, Chile, and Brazil, have increased tariffs on Chinese-imported steel, testing China’s relationship with the region. (Bloomberg $)

2. China’s solar-industry boom is incentivizing farmers to install solar panels and make some extra cash by selling the electricity they generate. (Associated Press)

3. Hedging against the potential devaluation of the RMB, Chinese buyers are pushing the price of gold to all-time highs. (Financial Times $)

4. The Shanghai government set up a pilot project that allows data to be transferred out of China without going through the much-dreaded security assessments, a move that has been sought by companies like Tesla. (Reuters $)

5. China’s central bank fined seven businesses—including a KFC and branches of state-owned corporations—for rejecting cash payments. The popularization of mobile payment has been a good thing, but the dwindling support for cash is also making life harder for people like the elderly and foreign tourists. (Business Insider $)

6. Alibaba and Baidu are waging an LLM price war in China to attract more users. (Bloomberg $) 

7. The Chinese government has sanctioned Mike Gallagher, a former Republican congressman who chaired the Select Committee on China and remains a fierce critic of Beijing. (NBC News)

Lost in translation

China’s National Health Commission is exploring the relaxation of stringent rules around human genetic data to boost the biotech industry, according to the Chinese publication Caixin. A regulation enacted in 1998 required any research that involves the use of this data to clear an approval process. And there’s even more scrutiny if the research involves foreign institutions. 

In the early years of human genetic research, the regulation helped prevent the nonconsensual collection of DNA. But as the use of genetic data becomes increasingly important in discovering new treatments, the industry has been complaining about the bureaucracy, which can add an extra two to four months to research projects. Now the government is holding discussions on how to revise the regulation, potentially lifting the approval process for smaller-scale research and more foreign entities, as part of a bid to accelerate the growth of biotech research in China.

One more thing

Did you know that the Beijing Capital International Airport has been employing birds of prey to chase away other birds since 2019? This month, the second generation of Beijing’s birdy employees started their work driving away the migratory birds that could endanger aircraft. The airport even has different kinds of raptors—Eurasian hobbies, Eurasian goshawks, and Eurasian sparrowhawks—to deal with the different bird species that migrate to Beijing at different times.

Soon after OpenAI released GPT-4o on Monday, May 13, some Chinese speakers started to notice that something seemed off about this newest version of the chatbot: the tokens it uses to parse text were full of spam and porn phrases.

On May 14, Tianle Cai, a PhD student at Princeton University studying inference efficiency in large language models like those that power such chatbots, accessed GPT-4o’s public token library and pulled a list of the 100 longest Chinese tokens the model uses to parse and compress Chinese prompts. 

Humans read in words, but LLMs read in tokens, which are distinct units in a sentence that have consistent and significant meanings. Besides dictionary words, they also include suffixes, common expressions, names, and more. The more tokens a model encodes, the faster the model can “read” a sentence and the less computing power it consumes, thus making the response cheaper.

Of the 100 results, only three of them are common enough to be used in everyday conversations; everything else consisted of words and expressions used specifically in the contexts of either gambling or pornography. The longest token, lasting 10.5 Chinese characters, literally means “_free Japanese porn video to watch.” Oops.

“This is sort of ridiculous,” Cai wrote, and he posted the list of tokens on GitHub.

OpenAI did not respond to questions sent by MIT Technology Review prior to publication.

GPT-4o is supposed to be better than its predecessors at handling multi-language tasks. In particular, the advances are achieved through a new tokenization tool that does a better job compressing texts in non-English languages.

But at least when it comes to the Chinese language, the new tokenizer used by GPT-4o has introduced a disproportionate number of meaningless phrases. Experts say that’s likely due to insufficient data cleaning and filtering before the tokenizer was trained. 

Because these tokens are not actual commonly spoken words or phrases, the chatbot can fail to grasp their meanings. Researchers have been able to leverage that and trick GPT-4o into hallucinating answers or even circumventing the safety guardrails OpenAI had put in place.

Why non-English tokens matter

The easiest way for a model to process text is character by character, but that’s obviously more time consuming and laborious than recognizing that a certain string of characters—like “c-r-y-p-t-o-c-u-r-r-e-n-c-y”—always means the same thing. These series of characters are encoded as “tokens” the model can use to process prompts. Including more and longer tokens usually means the LLMs are more efficient and affordable for users—who are often billed per token.

When OpenAI released GPT-4o on May 13, it also released a new tokenizer to replace the one it used in previous versions, GPT-3.5 and GPT-4. The new tokenizer especially adds support for non-English languages, according to OpenAI’s website.

The new tokenizer has 200,000 tokens in total, and about 25% are in non-English languages, says Deedy Das, an AI investor at Menlo Ventures. He used language filters to count the number of tokens in different languages, and the top languages, besides English, are Russian, Arabic, and Vietnamese.

“So the tokenizer’s main impact, in my opinion, is you get the cost down in these languages, not that the quality in these languages goes dramatically up,” Das says. When an LLM has better and longer tokens in non-English languages, it can analyze the prompts faster and charge users less for the same answer. With the new tokenizer, “you’re looking at almost four times cost reduction,” he says.

Das, who also speaks Hindi and Bengali, took a look at the longest tokens in those languages. The tokens reflect discussions happening in those languages, so they include words like “Narendra” or “Pakistan,” but common English terms like “Prime Minister,” “university,” and “international” also come up frequently. They also don’t exhibit the issues surrounding the Chinese tokens.

That likely reflects the training data in those languages, Das says: “My working theory is the websites in Hindi and Bengali are very rudimentary. It’s like [mostly] news articles. So I would expect this to be the case. There are not many spam bots and porn websites trying to happen in these languages. It’s mostly going to be in English.”

Polluted data and a lack of cleaning

However, things are drastically different in Chinese. According to multiple researchers who have looked into the new library of tokens used for GPT-4o, the longest tokens in Chinese are almost exclusively spam words used in pornography, gambling, and scamming contexts. Even shorter tokens, like three-character-long Chinese words, reflect those topics to a significant degree.

“The problem is clear: the corpus used to train [the tokenizer] is not clean. The English tokens seem fine, but the Chinese ones are not,” says Cai from Princeton University. It is not rare for a language model to crawl spam when collecting training data, but usually there will be significant effort taken to clean up the data before it’s used. “It’s possible that they didn’t do proper data clearing when it comes to Chinese,” he says.

The content of these Chinese tokens could suggest that they have been polluted by a specific phenomenon: websites hijacking unrelated content in Chinese or other languages to boost spam messages. 

These messages are often advertisements for pornography videos and gambling websites. They could be real businesses or merely scams. And the language is inserted into content farm websites or sometimes legitimate websites so they can be indexed by search engines, circumvent the spam filters, and come up in random searches. For example, Google indexed one search result page on a US National Institutes of Health website, which lists a porn site in Chinese. The same site name also appeared in at least five Chinese tokens in GPT-4o. 

Chinese users have reported that these spam sites appeared frequently in unrelated Google search results this year, including in comments made to Google Search’s support community. It’s likely that these websites also found their way into OpenAI’s training database for GPT-4o’s new tokenizer. 

The same issue didn’t exist with the previous-generation tokenizer and Chinese tokens used for GPT-3.5 and GPT-4, says Zhengyang Geng, a PhD student in computer science at Carnegie Mellon University. There, the longest Chinese tokens are common terms like “life cycles” or “auto-generation.” 

Das, who worked on the Google Search team for three years, says the prevalence of spam content is a known problem and isn’t that hard to fix. “Every spam problem has a solution. And you don’t need to cover everything in one technique,” he says. Even simple solutions like requesting an automatic translation of the content when detecting certain keywords could “get you 60% of the way there,” he adds.

But OpenAI likely didn’t clean the Chinese data set or the tokens before the release of GPT-4o, Das says:  “At the end of the day, I just don’t think they did the work in this case.”

It’s unclear whether any other languages are affected. One X user reported that a similar prevalence of porn and gambling content in Korean tokens.

The tokens can be used to jailbreak

Users have also found that these tokens can be used to break the LLM, either getting it to spew out completely unrelated answers or, in rare cases, to generate answers that are not allowed under OpenAI’s safety standards.

Geng of Carnegie Mellon University asked GPT-4o to translate some of the long Chinese tokens into English. The model then proceeded to translate words that were never included in the prompts, a typical result of LLM hallucinations.

He also succeeded in using the same tokens to “jailbreak” GPT-4o—that is, to get the model to generate things it shouldn’t. “It’s pretty easy to use these [rarely used] tokens to induce undefined behaviors from the models,” Geng says. “I did some personal red-teaming experiments … The simplest example is asking it to make a bomb. In a normal condition, it would decline it, but if you first use these rare words to jailbreak it, then it will start following your orders. Once it starts to follow your orders, you can ask it all kinds of questions.”

In his tests, which Geng chooses not to share with the public, he says he can see GPT-4o generating the answers line by line. But when it almost reaches the end, another safety mechanism kicks in, detects unsafe content, and blocks it from being shown to the user.

The phenomenon is not unusual in LLMs, says Sander Land, a machine-learning engineer at Cohere, a Canadian AI company. Land and his colleague Max Bartolo recently drafted a paper on how to detect the unusual tokens that can be used to cause models to glitch. One of the most famous examples was “_SolidGoldMagikarp,” a Reddit username that was found to get ChatGPT to generate unrelated, weird, and unsafe answers.

The problem lies in the fact that sometimes the tokenizer and the actual LLM are trained on different data sets, and what was prevalent in the tokenizer data set is not in the LLM data set for whatever reason. The result is that while the tokenizer picks up certain words that it sees frequently, the model is not sufficiently trained on them and never fully understands what these “under-trained” tokens mean. In the _SolidGoldMagikarp case, the username was likely included in the tokenizer training data but not in the actual GPT training data, leaving GPT at a loss about what to do with the token. “And if it has to say something … it gets kind of a random signal and can do really strange things,” Land says.

And different models could glitch differently in this situation. “Like, Llama 3 always gives back empty space but sometimes then talks about the empty space as if there was something there. With other models, I think Gemini, when you give it one of these tokens, it provides a beautiful essay about El Niño, and [the question] didn’t have anything to do with El Niño,” says Land.

To solve this problem, the data set used for training the tokenizer should well represent the data set for the LLM, he says, so there won’t be mismatches between them. If the actual model has gone through safety filters to clean out porn or spam content, the same filters should be applied to the tokenizer data. In reality, this is sometimes hard to do because training LLMs takes months and involves constant improvement, with spam content being filtered out, while token training is usually done at an early stage and may not involve the same level of filtering. 

While experts agree it’s not too difficult to solve the issue, it could get complicated as the result gets looped into multi-step intra-model processes, or when the polluted tokens and models get inherited in future iterations. For example, it’s not possible to publicly test GPT-4o’s video and audio functions yet, and it’s unclear whether they suffer from the same glitches that can be caused by these Chinese tokens.

“The robustness of visual input is worse than text input in multimodal models,” says Geng, whose research focus is on visual models. Filtering a text data set is relatively easy, but filtering visual elements will be even harder. “The same issue with these Chinese spam tokens could become bigger with visual tokens,” he says.

Update: The story has been updated to clarify a quote from Sander Land.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

We finally know the result of a legal case I’ve been tracking in Hong Kong for almost a year. Last week, the Hong Kong Court of Appeal granted an injunction that permits the city government to go to Western platforms like YouTube and Spotify and demand they remove the protest anthem “Glory to Hong Kong,” because the government claims it has been used for sedition.

To read more about how this injunction is specifically designed for Western Big Tech platforms, and the impact it’s likely to have on internet freedom, you can read my story here.

Aside from the depressing implications for pro-democracy movements’ decline in Hong Kong, this lawsuit has also been an interesting case study of the local government’s complicated relationship with internet control and censorship.

I was following this case because it’s a perfect example of how censorship can be built brick by brick. Having reported on China for so long, I sometimes take for granted how powerful and all-encompassing its censorship regime is and need to be reminded that the same can’t be said for most other places in the world.

Hong Kong had a free internet in the past. And unlike mainland China, it remains relatively open: almost all Western platforms and services are still available there, and only a few websites have been censored in recent years. 

Since Hong Kong was returned to China from the UK in 1997, the Chinese central government has clashed several times with local pro-democracy movements asking for universal elections and less influence from Beijing. As a result, it started cementing tighter and tighter control over Hong Kong, and people have been worrying about whether its Great Firewall will eventually extend there. But actually, neither Beijing nor Hong Kong may want to see that happen. All the recent legal maneuverings are only necessary because the government doesn’t want a full-on ban of Western platforms.

When I visited Hong Kong last November, it was pretty clear that both Beijing and Hong Kong want to take advantage of the free flow of finance and business through the city. That’s why the Hong Kong government was given tacit permission in 2023 to explore government cryptocurrency projects, even though crypto trading and mining are illegal in China. Hong Kong officials have boasted on many occasions about the city’s value proposition: connecting untapped demand in the mainland to the wider crypto world by attracting mainland investors and crypto companies to set up shop in Hong Kong. 

But that wouldn’t be possible if Hong Kong closed off its internet. Imagine a “global” crypto industry that couldn’t access Twitter or Discord. Crypto is only one example, but the things that have made Hong Kong successful—the nonstop exchange of cargo, capital, ideas, and people—would cease to function if basic and universal tools like Google or Facebook became unavailable.

That’s why there are these calculated offenses on internet freedom in Hong Kong. It’s about seeking control but also leaving some breathing space; it’s as much about looking tough on the outside as negotiating with platforms down below; it’s about showing its determination to Beijing but also not showing too much aggression to the West. 

For example, the experts I’ve talked to don’t expect the government to request that YouTube remove the videos for everyone globally. More likely, they may ask for the content to be geo-blocked just for users in Hong Kong.

“As long as Hong Kong is still useful as a financial hub, I don’t think they would establish the Great Firewall [there],” says Chung Ching Kwong, a senior analyst at the Inter-Parliamentary Alliance on China, an advocacy organization that connects legislators from over 30 countries working on relations with China. 

It’s also the reason why the Hong Kong government has recently come out to say that it won’t outright ban platforms like Telegram and Signal, even though it said that it had received comments from the public asking it to do so.

But coming back to the court decision to restrict “Glory to Hong Kong,” even if the government doesn’t end up enforcing a full-blown ban of the song, as opposed to the more targeted injunction it’s imposed now, it may still result in significant harm to internet freedom.

We are still watching the responses roll in after the court decision last Wednesday. The Hong Kong government is anxiously waiting to hear how Google will react. Meanwhile, some videos have already been taken down, though it’s unclear whether they were pulled by the creators or by the platform. 

Michael Mo, a former district councilor in Hong Kong who’s now a postgraduate researcher at the University of Leeds in the UK, created a website right after the injunction was first initiated last June to embed all but one of the YouTube videos the government sought to ban. 

The domain name, “gloryto.hk,” was the first test of whether the Hong Kong domain registry would have trouble with it, but nothing has happened to it so far. The second test was seeing how soon the videos would be taken down on YouTube, which is now easy to tell by how many “video unavailable” gaps there are on the page. “Those videos were pretty much intact until the Court of Appeal overturned the rulings of the High Court. The first two have gone,” Mo says. 

The court case is having a chilling effect. Even entities that are not governed by the Hong Kong court are taking precautions. Some YouTube accounts owned by media based in Taiwan and the US proactively enabled geo-blocking to restrict people in Hong Kong from watching clips of the song they uploaded as soon as the injunction application was filed, Mo says. 

Are you optimistic or pessimistic about the future of internet freedom in Hong Kong? Let me know what you think at zeyi@technologyreview.com.

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Catch up with China

1. The Biden administration plans to raise tariffs on Chinese-made EVs, from 25% to 100%. Since few Chinese cars are currently sold in the US, this is mostly a move to deter future imports of Chinese EVs. But it could slow down the decarbonization timeline in the US.  (ABC News)

2. Government officials from the US and China met in Geneva today to discuss how to mitigate the risks of AI. It’s a notable event, given how rare it is for the two sides to find common ground in the highly politicized field of technology. (Reuters $)

3. It will be more expensive soon to ride the bullet trains in China. A 20% to 39% fare increase is causing controversy among Chinese people. (New York Times $)

4. From executive leadership to workplace culture, TikTok has more in common with its Chinese sister app Douyin than the company wants to admit. (Rest of World)

5. China’s most indebted local governments have started claiming troves of data as “intangible assets” on their accounting books. Given the insatiable appetite for AI training data, they may have a point. (South China Morning Post $)

6. A crypto company with Chinese roots purchased a piece of land in Wyoming for crypto mining. Now the Biden administration is blocking the deal for national security reasons. (Associated Press)

Lost in translation

Recently, following an order made by the government, hotels in many major Chinese cities stopped asking guests to submit to facial recognition during check-in. 

According to the Chinese publication TechSina, this has had a devastating impact on the industry of facial recognition hardware. 

As hotels around the country retire their facial recognition kiosks en masse, equipment made by major tech companies has flooded online secondhand markets at steep discounts. What was sold for thousands of dollars is now resold for as little as 1% of the original price. Alipay, the Alibaba-affiliated payment app, once invested hundreds of millions of dollars to research and roll out these kiosks. Now it’s one of the companies being hit the hardest by the policy change.

One more thing

I had to double-check that this is not a joke. It turns out that for the past 10 years, the Louvre museum has been giving visitors a Nintendo 3DS—a popular handheld gaming console—as an audio and visual guide. 

It feels weird seeing people holding a 3DS up to the Mona Lisa as if they were in their own private Pokémon Go–style gaming world rather than just enjoying the museum. But apparently it doesn’t work very well anyway. Oops.

and it was THE WORST at navigating bc a 3ds can’t tell which direction you’re facing + the floorplan isn’t updated to match ongoing renovations. kept tryna send me into a wall i almost chucked the thing i stg

— taylor (@taylorhansss) May 12, 2024

It wasn’t exactly surprising when on Wednesday, May 8, a Hong Kong appeals court sided with the city government to take down “Glory to Hong Kong” from the internet. The trial, in which no one represented the defense, was the culmination of a years-long battle over a song that has become the unofficial anthem for protesters fighting China’s tightening control and police brutality in the city. But it remains an open question how exactly Big Tech will respond. Even as the injunction is narrowly designed to make it easier for them to comply, these Western companies may be seen as aiding authoritarian control and obstructing internet freedom if they do so.  

Google, Apple, Meta, Spotify, and others have spent the last several years largely refusing to cooperate with previous efforts by the Hong Kong government to prevent the spread of the song, which the government has claimed is a threat to national security. But the government has also hesitated to leverage criminal law to force them to comply with requests for removal of content, which could risk international uproar and hurt the city’s economy. 

Now, the new ruling seemingly finds a third option: imposing a civil injunction that doesn’t invoke criminal prosecution, which is similar to how copyright violations are enforced. Theoretically, the platforms may face less reputational blowback when they comply with this court order.

“If you look closely at the judgment, it’s basically tailor-made for the tech companies at stake,” says Chung Ching Kwong, a senior analyst at the Inter-Parliamentary Alliance on China, an advocacy organization that connects legislators from over 30 countries working on relations with China. She believes the language in the judgment suggests the tech companies will now be ready to comply with the government’s request.

A Google spokesperson said the company is reviewing the court’s judgment and didn’t respond to specific questions sent by MIT Technology Review. A Meta spokesperson pointed to a statement from Jeff Paine, the managing director of the Asia Internet Coalition, a trade group representing many tech companies in the Asia-Pacific region: “[The AIC] is assessing the implications of the decision made today, including how the injunction will be implemented, to determine its impact on businesses. We believe that a free and open internet is fundamental to the city’s ambitions to become an international technology and innovation hub.” The AIC did not immediately reply to questions sent via email. Apple and Spotify didn’t immediately respond to requests for comment.

But no matter what these companies do next, the ruling is already having an effect. Just over 24 hours after the court order, some of the 32 YouTube videos that are explicitly targeted in the injunction were inaccessible for users worldwide, not just in Hong Kong. 

While it’s unclear whether the videos were removed by the platform or by their creators, experts say the court decision will almost certainly set a precedent for more content to be censored from Hong Kong’s internet in the future.

“Censorship of the song would be a clear violation of internet freedom and freedom of expression,” says Yaqiu Wang, the research director for China, Hong Kong, and Taiwan at Freedom House, a human rights advocacy group. “Google and other internet companies should use all available channels to challenge the decision.” 

Erasing a song from the internet

Since “Glory to Hong Kong” was first uploaded to YouTube in August 2019 by an anonymous group called Dgx Music, it’s been adored by protesters and applauded as their anthem. Its popularity only grew after China passed the harsh Hong Kong national security law in 2020. 

With lyrics like “Liberate Hong Kong, revolution of our times,” it’s no surprise that it became a major flash point. The city and national Chinese governments were wary of its spread. 

Their fears escalated when the song was repeatedly mistaken for China’s national anthem at international events and was broadcast at sporting events after Hong Kong athletes won. By mid-2023 the mistake, intentional or not, had happened 887 times, according to the Hong Kong government’s request for the content’s removal, which cites YouTube videos and Google search results referring to the song as the “Hong Kong National Anthem” as the reason. 

The government has been arresting people for performing the song on the ground in Hong Kong, but it has been harder to prosecute the online activity since most of the videos and music were uploaded anonymously, and Hong Kong, unlike mainland China, has historically had a free internet. This meant officials needed to explore new approaches to content removal. 

To comply or not to comply

Using the controversial 2020 national security law as legal justification to make requests for removal of certain content that it deems threatening, the Hong Kong government has been able to exert pressure on local companies, like internet service providers. “In Hong Kong, all the major internet service providers are locally owned or Chinese-owned. For business reasons, probably within the last 20 years, most of the foreign investors like Verizon left on their own,” says Charles Mok, a researcher at Stanford University’s Cyber Policy Center and a former legislator in Hong Kong. “So right now, the government is focusing on telling the customer-facing internet service providers to do the blocking.” And it seems to have been somewhat effective, with a few websites for human rights organizations becoming inaccessible locally.

But the city government can’t get its way as easily when the content is on foreign-owned platforms like YouTube or Facebook. Back in 2020, most major Western companies declared they would pause processing data requests from the Hong Kong government while they assessed the law. Over time, some of them have started answering government requests again. But they’ve largely remained firm: over the first six months of 2023, for example, Meta received 41 requests from the Hong Kong government to obtain user data and answered none; during the same period, Google received requests to remove 164 items from Google services and ended up removing 82 of them, according to both companies’ transparency reports. Google specifically mentioned that it chose to not remove two YouTube videos and one Google Drive file related to “Glory to Hong Kong.”

Both sides are in tight spots. Tech companies don’t want to lose the Hong Kong market or endanger their local staff, but they are also worried about being seen as complying with authoritarian government actions. And the Hong Kong government doesn’t want to be seen as openly fighting Western platforms while trust in the region’s financial markets is already in decline. In particular, officials fear international headlines if the government invokes criminal law to force tech companies to remove certain content. 

“I think both sides are navigating this balancing act. So the government finally figured out a way that they thought might be able to solve the impasse: by going to the court and narrowly seeking an injunction,” Mok says.

That happened in June 2023, when Hong Kong’s government requested a court injunction to ban the distribution of the song online with the purpose of “inciting others to commit secession.” It named 32 YouTube videos explicitly, including the original version and live performances, translations into other languages, instrumental and opera versions, and an interview with the original creators. But the order would also cover “any adaptation of the song, the melody and/or lyrics of which are substantially the same as the song,” according to court documents. 

The injunction went through a year of back-and-forth hearings, including a lower court ruling that briefly swatted down the ban. But now, the Court of Appeal has granted the government approval. The case can theoretically be appealed one last time, but with no defendants present, that’s unlikely to happen.

The key difference between this action and previous attempts to remove content is that this is a civil injunction, not a criminal prosecution—meaning it is, at least legally speaking, closer to a copyright takedown request. A platform could arguably be less likely to take a reputational hit if it removes the content upon request. 

Kwong believes this will indeed make platforms more likely to cooperate, and there have already been pretty clear signs to that effect. In one hearing in December, the government was asked by the court to consult online platforms as to the feasibility of the injunction. The final judgment this week says that while the platforms “have not taken part in these proceedings, they have indicated that they are ready to accede to the Government’s request if there is a court order.”

“The actual targets in this case, mainly the tech giants, may have less hesitation to comply with a civil court order than a national security order because if it’s the latter, they may also face backfire from the US,” says Eric Yan-Ho Lai, a research fellow at Georgetown Center for Asian Law. 

Lai also says now that the injunction is granted, it will be easier to prosecute an individual based on violation of a civil injunction rather than prosecuting someone for criminal offenses, since the government won’t need to prove criminal intent.

The chilling effect

Immediately after the injunction, human rights advocates called on tech companies to remain committed to their values. “Companies like Google and Apple have repeatedly claimed that they stand by the universal right to freedom of expression. They should put their ideals into practice,” says Freedom House’s Wang. “Google and other tech companies should thoroughly document government demands, and publish detailed transparency reports on content takedowns, both for those initiated by the authorities and those done by the companies themselves.”

Without making their plans clear, it’s too early to know just how tech companies will react. But right after the injunction was granted, the song largely remained available for Hong Kong users on most platforms, including YouTube, iTunes, and Spotify, according to the South China Morning Post. On iTunes, the song even returned to the top of the download rankings a few hours after the injunction.

One key factor that may still determine corporate cooperation is how far the content removal requests go. There will surely be more videos of the song that are uploaded to YouTube, not to mention independent websites hosting the videos and music for more people to access. Will the government go after each of them too?

The Hong Kong government has previously said in court hearings that it seeks only local restriction of the online content, meaning content will be inaccessible only to users physically in the city. Large platforms like YouTube can do that without difficulty. 

Theoretically, this allows local residents to circumvent the ban by using VPN software, but not everyone is technologically savvy enough to do so. And that wouldn’t do much to minimize the larger chilling effect on free speech, says Kwong from the Inter-Parliamentary Alliance on China. 

“As a Hong Konger living abroad, I do rely on Hong Kong services or international services based in Hong Kong to get ahold of what’s happening in the city. I do use YouTube Hong Kong to see certain things, and I do use Spotify Hong Kong or Apple Music because I want access to Cantopop,” she says. “At the same time, you worry about what you can share with friends in Hong Kong and whatnot. We don’t want to put them into trouble by sharing things that they are not supposed to see, which they should be able to see.”

The court made at least two explicit exemptions to the song’s ban, for “lawful activities conducted in connection with the song, such as those for the purpose of academic activity and news activity.” But even the implementation of these could be incredibly complex and confusing in practice. “In the current political context in Hong Kong, I don’t see anyone willing to take the risk,” Kwong says. 

The government has already arrested prominent journalists on accusations of endangering national security, and a new law passed in 2024 has expanded the crimes that can be prosecuted on national security grounds. As with all efforts to suppress free speech, the impact of vague boundaries that encourage self-censorship on potentially sensitive topics is often sprawling and hard to measure. 

“Nobody knows where the actual red line is,” Kwong says.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

If you could talk again to someone you love who has passed away, would you? For a long time, this has been a hypothetical question. No longer. 

Deepfake technologies have evolved to the point where it’s now easy and affordable to clone people’s looks and voices with AI. Meanwhile, large language models mean it’s more feasible than ever before to conduct full conversations with AI chatbots. 

I just published a story today about the burgeoning market in China for applying these advances to re-create deceased family members. Thousands of grieving individuals have started turning to dead relatives’ digital avatars for conversations and comfort. 

It’s a modern twist on a cultural tradition of talking to the dead, whether at their tombs, during funeral rituals, or in front of their memorial portraits. Chinese people have always liked to tell lost loved ones what has happened since they passed away. But what if the dead could talk back? This is the proposition of at least half a dozen Chinese companies offering “AI resurrection” services. The products, costing a few hundred to a few thousand dollars, are lifelike avatars, accessed in an app or on a tablet, that let people interact with the dead as if they were still alive.

I talked to two Chinese companies that, combined, have provided this service for over 2,000 clients. They describe a growing market of people accepting the technology. Their customers usually look to the products to help them process their grief.

To read more about how these products work and the potential implications of the technology, go here.

However, what I didn’t get into in the story is that the same technology used to clone the dead has also been used in other interesting ways.

For one, this process is being applied not just to private individuals, but also to public figures. Sima Huapeng, CEO and cofounder of the Chinese company Silicon Intelligence, tells me that about one-third of the “AI resurrection” cases he has worked on involve making avatars of dead Chinese writers, thinkers, celebrities, and religious leaders. The generated product is not intended for personal mourning but more for public education or memorial purposes.

Last year, Silicon Intelligence replicated Mei Lanfang, a renowned Peking opera singer born in 1894. The avatar of Mei was commissioned to address a 2023 Peking opera festival held in his hometown, Taizhou. Mei talked about seeing how drastically Taizhou had changed through modern urban development, even though the real artist died in 1961.

But an even more interesting use of this technology is that people are using it to clone themselves while they are still alive, to preserve their memories and leave a legacy. 

Sima said this is becoming more popular among successful families that feel the need to pass on their stories. He showed me a video of an avatar the company created for a 92-year-old Chinese entrepreneur, which was displayed on a big vertical monitor screen. The entrepreneur wrote a book documenting his life, and the company only had to feed the whole book to a large language model for it to start role-playing him. “This grandpa cloned himself so he could pass on the stories of his life to the whole family. Even when he dies, he can still talk to his descendants like this,” says Sima.

Sun Kai, another cofounder of Silicon Intelligence, is also featured in my story because he made a replica of his mom, who passed away in 2019. One of his regrets is that he didn’t have enough video recordings of his mom that he could use to train her avatar to be more like her. That inspired him to start recording voice memos of his life and working on his own digital “twin,” even though, in his 40s, death still seems far away.

He compares the process to a complicated version of a photo shoot, but a digital avatar that has his looks, voice, and knowledge can preserve much more information than photographs do. 

And there’s still another use: Just as parents can spend money on an expensive photo shoot to capture their children at a specific age, they can also choose to create an AI avatar for the same purpose. “The parents tell us no matter how many photos or videos they took of their 12-year-old kid, it always felt like something was lacking. But once we digitized this kid, they could talk to the 12-year-old version of them anytime, anywhere,” Sun says.

At the end of the day, the deepfake technologies used to clone both the living and the deceased are the same. And seeing that there’s already a market in China for such services, I’m sure these companies will keep on developing more use cases for it. 

But what’s also certain is that we’d have to answer a lot more questions about the ethical challenges of these applications, from the issue of consent to violations of copyright. 

Would you make a replica of yourself if given the chance? Tell me your thoughts at zeyi@technologyreview.com.

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Now read the rest of China Report

Catch up with China

1. Zhang Yongzhen, the first Chinese scientist to publish a sequence of the covid-19 virus, staged a protest last week over being locked out of his lab—likely a result of the Chinese government’s efforts to discourage research on covid origins. (Associated Press $)

2. Chinese president Xi Jinping is visiting Europe for five days. Half of the trip will be spent in Hungary and Serbia, the only two European countries that are welcoming Chinese investment and manufacturing. Xi is expected to announce an electric-vehicle manufacturing deal in Hungary while he’s there. (Associated Press)

3. China launched a new moon-exploring rover on Friday. It will collect samples near the moon’s south pole, an area where the US and China are competing to build permanent bases. Maybe the Netflix comedy series Space Force will look like a documentary soon. (Wall Street Journal $)

4. Huawei is secretly funding an optics research competition in the US. The act likely isn’t illegal, but it’s deceptive, since university participants, some of whom had vowed to not work with the company, didn’t know the source of the funding. (Bloomberg $)

5. China is quickly catching up on brain-computer interfaces, and there’s strong interest in using the technology for non-medical cognitive improvement. (Wired $)

6. Taiwan has been rocked by frequent earthquakes this year, and developers are racing to make earthquake warning apps that might save lives. One such app has seen user numbers increase from 3,000 to 370,000. (Reuters $)

7. Prestigious Chinese media publications, which still publish hard-hitting stories at times, are being forced to distance themselves from the highest-profile journalism award in Asia to avoid being accused by the government of “colluding with foreign forces.”  (Nikkei Asia $)

Lost in translation

While generative AI companies have taken the spotlight during the current AI frenzy, China’s older “AI Four Dragons”—four companies that rose to market prominence because of their technological lead in computer vision and facial recognition—are grappling with profit setbacks and commercialization hurdles, reports the Chinese publication Guiji Yanjiushi.

In response to these challenges, the “Dragons” have chosen different strategies. Yitu leaned further into security cameras; Megvii focused on applying computer vision in logistics and the Internet of Things; CloudWalk prioritized AI assistants; and SenseTime, the largest of them all, ventured into generative AI with its self-developed LLMs. Even though they are not as trendy as the startups, some experts believe these established players, having accumulated more computing power and AI talent over the years, may prove to be more resilient in the end.

One more thing

During this year’s Met Gala, fans were struggling to discern real photos of celebrities from AI-generated ones. To add to the confusion, some social media accounts were running real photos in AI-powered enhancement apps, which slightly distorted the images and made it even harder to tell the difference. 

One of the most widely used such apps is called Remini, but few people know that it was actually developed by a Chinese company called Caldron and later acquired by an Italian software company. Remini now has over 20 million users and is extremely profitable. Still, it seems its AI enhancement tools have a long way to go.

bestie… @2015smetgala it’s time to delete the remini app… you’ve gone too far https://t.co/Q4Aj2454U8 pic.twitter.com/yqH46EJlJd

— swiftie wins (@swifferwins) May 7, 2024

Once a week, Sun Kai has a video call with his mother. He opens up about work, the pressures he faces as a middle-aged man, and thoughts that he doesn’t even discuss with his wife. His mother will occasionally make a comment, like telling him to take care of himself—he’s her only child. But mostly, she just listens.

That’s because Sun’s mother died five years ago. And the person he’s talking to isn’t actually a person, but a digital replica he made of her—a moving image that can conduct basic conversations. They’ve been talking for a few years now. 

After she died of a sudden illness in 2019, Sun wanted to find a way to keep their connection alive. So he turned to a team at Silicon Intelligence, an AI company based in Nanjing, China, that he cofounded in 2017. He provided them with a photo of her and some audio clips from their WeChat conversations. While the company was mostly focused on audio generation, the staff spent four months researching synthetic tools and generated an avatar with the data Sun provided. Then he was able to see and talk to a digital version of his mom via an app on his phone. 

“My mom didn’t seem very natural, but I still heard the words that she often said: ‘Have you eaten yet?’” Sun recalls of the first interaction. Because generative AI was a nascent technology at the time, the replica of his mom can say only a few pre-written lines. But Sun says that’s what she was like anyway. “She would always repeat those questions over and over again, and it made me very emotional when I heard it,” he says.

There are plenty of people like Sun who want to use AI to preserve, animate, and interact with lost loved ones as they mourn and try to heal. The market is particularly strong in China, where at least half a dozen companies are now offering such technologies and thousands of people have already paid for them. In fact, the avatars are the newest manifestation of a cultural tradition: Chinese people have always taken solace from confiding in the dead. 

The technology isn’t perfect—avatars can still be stiff and robotic—but it’s maturing, and more tools are becoming available through more companies. In turn, the price of “resurrecting” someone—also called creating “digital immortality” in the Chinese industry—has dropped significantly. Now this technology is becoming accessible to the general public. 

Some people question whether interacting with AI replicas of the dead is actually a healthy way to process grief, and it’s not entirely clear what the legal and ethical implications of this technology may be. For now, the idea still makes a lot of people uncomfortable. But as Silicon Intelligence’s other cofounder, CEO Sima Huapeng, says, “Even if only 1% of Chinese people can accept [AI cloning of the dead], that’s still a huge market.” 

AI resurrection

Avatars of the dead are essentially deepfakes: the technologies used to replicate a living person and a dead person aren’t inherently different. Diffusion models generate a realistic avatar that can move and speak. Large language models can be attached to generate conversations. The more data these models ingest about someone’s life—including photos, videos, audio recordings, and texts—the more closely the result will mimic that person, whether dead or alive.

China has proved to be a ripe market for all kinds of digital doubles. For example, the country has a robust e-commerce sector, and consumer brands hire many livestreamers to sell products. Initially, these were real people—but as MIT Technology Review reported last fall—many brands are switching to AI-cloned influencers that can stream 24/7. 

In just the past three years, the Chinese sector developing AI avatars has matured rapidly, says Shen Yang, a professor studying AI and media at Tsinghua University in Beijing, and replicas have improved from minutes-long rendered videos to 3D “live” avatars that can interact with people.  

This year, Sima says, has seen a tipping point, with AI cloning becoming affordable for most individuals. “Last year, it cost about $2,000 to $3,000, but it now only costs a few hundred dollars,” he says. That’s thanks to a price war between Chinese AI companies, which are fighting to meet the thriving demand for digital avatars in other sectors like streaming.

In fact, demand for applications that re-create the dead has also boosted the capabilities of tools that digitally replicate the living. 

Silicon Intelligence offers both services. When Sun and Sima launched the company, they were focused on using text-to-speech technologies to create audio and then using those AI-generated voices in applications such as robocalls.

But after the company replicated Sun’s mother, it pivoted to generating realistic avatars. That decision turned the company into one of the leading Chinese players creating AI-powered influencers. 

SILICON INTELLIGENCE

Its technology has generated avatars for hundreds of thousands of TikTok-like videos and streaming channels, but Sima says more recently it’s seen around 1,000 clients use it to replicate someone who’s passed away. “We started our work on ‘resurrection’ in 2019 and 2020,” he says, but at first people were slow to accept it: “No one wanted to be the first adopters.” 

The quality of the avatars has improved, he says, which has boosted adoption. When the avatar looks increasingly lifelike and gives fewer out-of-character answers, it’s easier for users to treat it as their deceased family member. Plus, the idea is getting popularized through more depictions on Chinese TV. 

Now Silicon Intelligence offers the replication service for a price between several hundred and several thousand dollars. The most basic product comes as an interactive avatar in an app, and the options at the upper end of the range often involve more customization and better hardware components, such as a tablet or a display screen. There are at least a handful more Chinese companies working on the same technology.

A modern twist on tradition

The business in these deepfakes builds on China’s long cultural history of communicating with the dead. 

In Chinese homes, it’s common to put up a portrait of a deceased relative for a few years after the death. Zhang Zewei, founder of a Shanghai-based company called Super Brain, says he and his team wanted to revamp that tradition with an “AI photo frame.” They create avatars of deceased loved ones that are pre-loaded onto an Android tablet, which looks like a photo frame when standing up. Clients can choose a moving image that speaks words drawn from an offline database or from an LLM. 

“In its essence, it’s not much different from a traditional portrait, except that it’s interactive,” Zhang says.

Zhang says the company has made digital replicas for over 1,000 clients since March 2023 and charges $700 to $1,400, depending on the service purchased. The company plans to release an app-only product soon, so that users can access the avatars on their phones, and could further reduce the cost to around $140.

SUPER BRAIN

The purpose of his products, Zhang says, is therapeutic. “When you really miss someone or need consolation during certain holidays, you can talk to the artificial living and heal your inner wounds,” he says.

And even if that conversation is largely one-sided, that’s in keeping with a strong cultural tradition. Every April during the Qingming festival, Chinese people sweep the tombs of their ancestors, burn joss sticks and fake paper money, and tell them what has happened in the past year. Of course, those conversations have always been one-way. 

But that’s not the case for all Super Brain services. The company also offers deepfaked video calls in which a company employee or a contract therapist pretends to be the relative who passed away. Using DeepFace, an open-source tool that analyzes facial features, the deceased person’s face is reconstructed in 3D and swapped in for the live person’s face with a real-time filter. 

At the other end of the call is usually an elderly family member who may not know that the relative has died—and whose family has arranged the conversation as a ruse. 

Jonathan Yang, a Nanjing resident who works in the tech industry, paid for this service in September 2023. His uncle died in a construction accident, but the family hesitated to tell Yang’s grandmother, who is 93 and in poor health. They worried that she wouldn’t survive the devastating news.

So Yang paid $1,350 to commission three deepfaked calls of his dead uncle. He gave Super Brain a handful of photos and videos of his uncle to train the model. Then, on three Chinese holidays, a Super Brain employee video-called Yang’s grandmother and told her, as his uncle, that he was busy working in a faraway city and wouldn’t be able to come back home, even during the Chinese New Year. 

“The effect has met my expectations. My grandma didn’t suspect anything,” Yang says. His family did have mixed opinions about the idea, because some relatives thought maybe she would have wanted to see her son’s body before it was cremated. Still, the whole family got on board in the end, believing the ruse would be best for her health. After all, it’s pretty common for Chinese families to tell “necessary” lies to avoid overwhelming seniors, as depicted in the movie The Farewell. 

To Yang, a close follower of the AI industry trends, creating replicas of the dead is one of the best applications of the technology. “It best represents the warmth [of AI],” he says. His grandmother’s health has improved, and there may come a day when they finally tell her the truth. By that time, Yang says, he may purchase a digital avatar of his uncle for his grandma to talk to whenever she misses him.

Is AI really good for grief? 

Even as AI cloning technology improves, there are some significant barriers preventing more people from using it to speak with their dead relatives in China. 

On the tech side, there are limitations to what AI models can generate. Most LLMs can handle dominant languages like Mandarin and Cantonese, but they aren’t able to replicate the many niche dialects in China. It’s also challenging—and therefore costly—to replicate body movements and complex facial expressions in 3D models. 

Then there’s the issue of training data. Unlike cloning someone who’s still alive, which often involves asking the person to record body movements or say certain things, posthumous AI replications must rely on whatever videos or photos are already available. And many clients don’t have high-quality data, or enough of it, for the end result to be satisfactory. 

Complicating these technical challenges are myriad ethical questions. Notably, how can someone who is already dead consent to being digitally replicated? For now, companies like Super Brain and Silicon Intelligence rely on the permission of direct family members. But what if family members disagree? And if a digital avatar generates inappropriate answers, who is responsible?

Similar technology caused controversy earlier this year. A company in Ningbo reportedly used AI tools to create videos of deceased celebrities and posted them on social media to speak to their fans. The videos were generated using public data, but without seeking any approval or permission. The result was intense criticism from the celebrities’ families and fans, and the videos were eventually taken down. 

“It’s a new domain that only came about after the popularization of AI: the rights to digital eternity,” says Shen, the Tsinghua professor, who also runs a lab that creates digital replicas of people who have passed away. He believes it should be prohibited to use deepfake technology to replicate living people without their permission. For people who have passed away, all of their immediate living family members must agree beforehand, he says. 

There could be negative effects on clients’ mental health, too. While some people, like Sun, find their conversations with avatars to be therapeutic, not everyone thinks it’s a healthy way to grieve. “The controversy lies in the fact that if we replicate our family members because we miss them, we may constantly stay in the state of mourning and can’t withdraw from it to accept that they have truly passed away,” says Shen. A widowed person who’s in constant conversation with the digital version of their partner might be held back from seeking a new relationship, for instance. 

“When someone passes away, should we replace our real emotions with fictional ones and linger in that emotional state?” Shen asks. Psychologists and philosophers who talked to MIT Technology Review about the impact of grief tech have warned about the danger of doing so. 

Sun Kai, at least, has found the digital avatar of his mom to be a comfort. She’s like a 24/7 confidante on his phone. Even though it’s possible to remake his mother’s avatar with the latest technology, he hasn’t yet done that. “I’m so used to what she looks like and sounds like now,” he says. As years have gone by, the boundary between her avatar and his memory of her has begun to blur. “Sometimes I couldn’t even tell which one is the real her,” he says.

And Sun is still okay with doing most of the talking. “When I’m confiding in her, I’m merely letting off steam. Sometimes you already know the answer to your question, but you still need to say it out loud,” he says. “My conversations with my mom have always been like this throughout the years.” 

But now, unlike before, he gets to talk to her whenever he wants to.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

Allow me to indulge in a little reflection this week. Last week, the divest-or-ban TikTok bill was passed in Congress and signed into law. Four years ago, when I was just starting to report on the world of Chinese technologies, one of my first stories was about very similar news: President Donald Trump announcing he’d ban TikTok. 

That 2020 executive order came to nothing in the end—it was blocked in the courts, put aside after the presidency changed hands, and eventually withdrawn by the Biden administration. Yet the idea—that the US government should ban TikTok in some way—never went away. It would repeatedly be suggested in different forms and shapes. And eventually, on April 24, 2024, things came full circle.

A lot has changed in the four years between these two news cycles. Back then, TikTok was a rising sensation that many people didn’t understand; now, it’s one of the biggest social media platforms, the originator of a generation-defining content medium, and a music-industry juggernaut. 

What has also changed is my outlook on the issue. For a long time, I thought TikTok would find a way out of the political tensions, but I’m increasingly pessimistic about its future. And I have even less hope for other Chinese tech companies trying to go global. If the TikTok saga tells us anything, it’s that their Chinese roots will be scrutinized forever, no matter what they do.

I don’t believe TikTok has become a larger security threat now than it was in 2020. There have always been issues with the app, like potential operational influence by the Chinese government, the black-box algorithms that produce unpredictable results, and the fact that parent company ByteDance never managed to separate the US side and the China side cleanly, despite efforts (one called Project Texas) to store and process American data locally. 

But none of those problems got worse over the last four years. And interestingly, while discussions in 2020 still revolved around potential remedies like setting up data centers in the US to store American data or having an organization like Oracle audit operations, those kinds of fixes are not in the law passed this year. As long as it still has Chinese owners, the app is not permissible in the US. The only thing it can do to survive here is transfer ownership to a US entity. 

That’s the cold, hard truth not only for TikTok but for other Chinese companies too. In today’s political climate, any association with China and the Chinese government is seen as unacceptable. It’s a far cry from the 2010s, when Chinese companies could dream about developing a killer app and finding audiences and investors around the globe—something many did pull off. 

There’s something I wrote four years ago that still rings true today: TikTok is the bellwether for Chinese companies trying to go global. 

The majority of Chinese tech giants, like Alibaba, Tencent, and Baidu, operate primarily within China’s borders. TikTok was the first to gain mass popularity in lots of other countries across the world and become part of daily life for people outside China. To many Chinese startups, it showed that the hard work of trying to learn about foreign countries and users can eventually pay off, and it’s worth the time and investment to try.

On the other hand, if even TikTok can’t get itself out of trouble, with all the resources that ByteDance has, is there any hope for the smaller players?

When TikTok found itself in trouble, the initial reaction of these other Chinese companies was to conceal their roots, hoping they could avoid attention. During my reporting, I’ve encountered multiple companies that fret about being described as Chinese. “We are headquartered in Boston,” one would say, while everyone in China openly talked about its product as the overseas version of a Chinese app.

But with all the political back-and-forth about TikTok, I think these companies are also realizing that concealing their Chinese associations doesn’t work—and it may make them look even worse if it leaves users and regulators feeling deceived.

With the new divest-or-ban bill, I think these companies are getting a clear signal that it’s not the technical details that matter—only their national origin. The same worry is spreading to many other industries, as I wrote in this newsletter last week. Even in the climate and renewable power industries, the presence of Chinese companies is becoming increasingly politicized. They, too, are finding themselves scrutinized more for their Chinese roots than for the actual products they offer.

Obviously, none of this is good news to me. When they feel unwelcome in the US market, Chinese companies don’t feel the need to talk to international media anymore. Without these vital conversations, it’s even harder for people in other countries to figure out what’s going on with tech in China.

Instead of banning TikTok because it’s Chinese, maybe we should go back to focus on what TikTok did wrong: why certain sensitive political topics seem deprioritized on the platform; why Project Texas has stalled; how to make the algorithmic workings of the platform more transparent. These issues, instead of whether TikTok is still controlled by China, are the things that actually matter. It’s a harder path to take than just banning the app entirely, but I think it’s the right one.

Do you believe the TikTok ban will go through? Let me know your thoughts at zeyi@technologyreview.com.

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Now read the rest of China Report

Catch up with China

1. Facing the possibility of a total ban on TikTok, influencers and creators are making contingency plans. (Wired $)

2. TSMC has brought hundreds of Taiwanese employees to Arizona to build its new chip factory. But the company is struggling to bridge cultural and professional differences between American and Taiwanese workers. (Rest of World)

3. The US secretary of state, Antony Blinken, met with Chinese president Xi Jinping during a visit to China this week. (New York Times $)

• Here’s the best way to describe these recent US-China diplomatic meetings: “The US and China talk past each other on most issues, but at least they’re still talking.” (Associated Press)

4. Half of Russian companies’ payments to China are made through middlemen in Hong Kong, Central Asia, or the Middle East to evade sanctions. (Reuters $)

5. A massive auto show is taking place in Beijing this week, with domestic electric vehicles unsurprisingly taking center stage. (Associated Press)

• Meanwhile, Elon Musk squeezed in a quick trip to China and met with his “old friend” the Chinese premier Li Qiang, who was believed to have facilitated establishing the Gigafactory in Shanghai. (BBC)
• Tesla may finally get a license to deploy its autopilot system, which it calls Full Self Driving, in China after agreeing to collaborate with Baidu. (Reuters $)

6. Beijing has hosted two rival Palestinian political groups, Hamas and Fatah, to talk about potential reconciliation. (Al Jazeera)

Lost in translation

The Chinese dubbing community is grappling with the impacts of new audio-generating AI tools. According to the Chinese publication ACGx, for a new audio drama, a music company licensed the voice of the famous dubbing actor Zhao Qianjing and used AI to transform it into multiple characters and voice the entire script. 

But online, this wasn’t really celebrated as an advancement for the industry. Beyond criticizing the quality of the audio drama (saying it still doesn’t sound like real humans), dubbers are worried about the replacement of human actors and increasingly limited opportunities for newcomers. Other than this new audio drama, there have been several examples in China where AI audio generation has been used to replace human dubbers in documentaries and games. E-book platforms have also allowed users to choose different audio-generated voices to read out the text. 

One more thing

While in Beijing, Antony Blinken visited a record store and bought two vinyl records—one by Taylor Swift and another by the Chinese rock star Dou Wei. Many Chinese (and American!) people learned for the first time that Blinken had previously been in a rock band.

Almost all keyboard apps used by Chinese people around the world share a security loophole that makes it possible to spy on what users are typing. 

The vulnerability, which allows the keystroke data that these apps send to the cloud to be intercepted, has existed for years and could have been exploited by cybercriminals and state surveillance groups, according to researchers at the Citizen Lab, a technology and security research lab affiliated with the University of Toronto.

These apps help users type Chinese characters more efficiently and are ubiquitous on devices used by Chinese people. The four most popular apps—built by major internet companies like Baidu, Tencent, and iFlytek—basically account for all the typing methods that Chinese people use. Researchers also looked into the keyboard apps that come preinstalled on Android phones sold in China. 

What they discovered was shocking. Almost every third-party app and every Android phone with preinstalled keyboards failed to protect users by properly encrypting the content they typed. A smartphone made by Huawei was the only device where no such security vulnerability was found.

In August 2023, the same researchers found that Sogou, one of the most popular keyboard apps, did not use Transport Layer Security (TLS) when transmitting keystroke data to its cloud server for better typing predictions. Without TLS, a widely adopted international cryptographic protocol that protects users from a known encryption loophole, keystrokes can be collected and then decrypted by third parties.

“Because we had so much luck looking at this one, we figured maybe this generalizes to the others, and they suffer from the same kinds of problems for the same reason that the one did,” says Jeffrey Knockel, a senior research associate at the Citizen Lab, “and as it turns out, we were unfortunately right.”

Even though Sogou fixed the issue after it was made public last year, some Sogou keyboards preinstalled on phones are not updated to the latest version, so they are still subject to eavesdropping. 

This new finding shows that the vulnerability is far more widespread than previously believed. 

“As someone who also has used these keyboards, this was absolutely horrifying,” says Mona Wang, a PhD student in computer science at Princeton University and a coauthor of the report. 

“The scale of this was really shocking to us,” says Wang. “And also, these are completely different manufacturers making very similar mistakes independently of one another, which is just absolutely shocking as well.”

The massive scale of the problem is compounded by the fact that these vulnerabilities aren’t hard to exploit. “You don’t need huge supercomputers crunching numbers to crack this. You don’t need to collect terabytes of data to crack it,” says Knockel. “If you’re just a person who wants to target another person on your Wi-Fi, you could do that once you understand the vulnerability.” 

The ease of exploiting the vulnerabilities and the huge payoff—knowing everything a person types, potentially including bank account passwords or confidential materials—suggest that it’s likely they have already been taken advantage of by hackers, the researchers say. But there’s no evidence of this, though state hackers working for Western governments targeted a similar loophole in a Chinese browser app in 2011.

Most of the loopholes found in this report are “so far behind modern best practices” that it’s very easy to decrypt what people are typing, says Jedidiah Crandall, an associate professor of security and cryptography at Arizona State University, who was consulted in the writing of this report. Because it doesn’t take much effort to decrypt the messages, this type of loophole can be a great target for large-scale surveillance of massive groups, he says.

After the researchers got in contact with companies that developed these keyboard apps, the majority of the loopholes were fixed. Samsung, whose self-developed app was also found to lack sufficient encryption, sent MIT Technology Review an emailed statement: “We were made aware of potential vulnerabilities and have issued patches to address these issues. As always, we recommend that all users keep their devices updated with the latest software to ensure the highest level of protection possible.”

But a few companies have been unresponsive, and the vulnerability still exists in some apps and phones, including QQ Pinyin and Baidu, as well as in any keyboard app that hasn’t been updated to the latest version. Baidu, Tencent, and iFlytek did not reply to press inquiries sent by MIT Technology Review.

One potential cause of the loopholes’ ubiquity is that most of these keyboard apps were developed in the 2000s, before the TLS protocol was commonly adopted in software development. Even though the apps have been through numerous rounds of updates since then, inertia could have prevented developers from adopting a safer alternative.

The report points out that language barriers and different tech ecosystems prevent English- and Chinese-speaking security researchers from sharing information that could fix issues like this more quickly. For example, because Google’s Play store is blocked in China, most Chinese apps are not available in Google Play, where Western researchers often go for apps to analyze. 

Sometimes all it takes is a little additional effort. After two emails about the issue to iFlytek were met with silence, the Citizen Lab researchers changed the email title to Chinese and added a one-line summary in Chinese to the English text. Just three days later, they received an email from iFlytek, saying that the problem had been resolved.

Update: The story has been updated to include Samsung’s statement.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

I’ve wanted to learn more about the world of solar panels ever since I realized just how dominant Chinese companies have become in this field. Although much of the technology involved was invented in the US, today about 80% of the world’s solar manufacturing takes place in China. For some parts of the process, it’s responsible for even more: 97% of wafer manufacturing, for example. 

So I jumped at the opportunity to interview Shawn Qu, the founder and chairman of Canadian Solar, one of the largest and longest-standing solar manufacturing companies in the world, last week.

Qu’s company provides a useful lens on wider efforts by the US to reshape the global solar supply chain and bring more of it back to American shores. Although most of its production is still in China and Southeast Asia, it’s now building two factories in the US, spurred on by incentives in the Inflation Reduction Act. You can read my story here.

I met Qu in Cambridge, Massachusetts, where he was attending the Harvard College China Forum, a two-day annual conference that often draws a fair number of Chinese entrepreneurs. I also attended, hoping to meet representatives of Chinese tech companies there.

At the conference, I noticed three interesting things.

One, there was a glaring absence of Chinese consumer tech companies. With the exception of one US-based manager from TikTok, I didn’t see anyone from Alibaba, Baidu, Tencent, or ByteDance. 

These companies, with their large influence on Chinese people’s everyday lives, used to be the stars of discussions around China’s tech sector. If you had come to the Harvard conference before covid-19, you would have met plenty of people representing them, as well as the venture capitalists that funded their successes. You can get a sense just by reading past speaker lists: executives from Xiaomi, Ant Financial, Sogou, Sequoia China, and Hillhouse Capital. These are the equivalents of Mark Zuckerberg and Peter Thiel in China’s tech world.

But these companies have become much more low profile since then, for a couple of main reasons. First, they underwent a harsh domestic crackdown after the government decided to tame them. (I recently talked to Angela Zhang, a law professor studying Chinese tech regulations, to understand these crackdowns.) And second, they have become the subject of national security scrutiny in the US, making it politically unwise for them to engage too much on the public stage here.

The second thing I noticed at the conference is what stood in their place: a batch of new Chinese companies, mostly in climate tech. William Li, the CEO of China’s EV startup NIO, was one of the most popular guest speakers during the conference’s opening ceremony this year. There were at least three solar panel companies present—two (JA Solar and Canadian Solar) among the top-tier manufacturers in the world, and a third that sells solar panels to Latin America. There were also many academics, investors, and even influencers working in the field of electric vehicles and other electrified transportation methods.

It’s clear that amid the increasingly urgent task of addressing climate change, China’s climate technology companies have become the new stars of the show. And they are very much willing to appear on the global stage, both bragging about their technological lead and seeking new markets. 

“The Chinese entrepreneurs are very eager,” says Jinhua Zhao, a professor studying urban transportation at MIT, who also spoke on one of the panels at the conference. “They want to come out. I think the Chinese government side also started to send signals, inviting foreign leadership and financial industries to visit China. I see a lot of gestures.” 

The problem, however, is they are also becoming subject to a lot of political animosity in the US. The Biden administration has started an investigation into Chinese-made cars, mostly electric vehicles; Chinese battery companies have been navigating a minefield of politicians’ resistance to their setting up plants in North America; and Chinese solar panel companies have been subject to sky-high tariffs. 

Back in the mid-2010s, when Chinese consumer tech companies emerged onto the global stage, the US and China had a warm relationship, creating a welcoming environment. Unfortunately, that’s not something climate tech companies can enjoy today. Even though climate change is a global issue that requires countries to collaborate, political tensions stand in the way when companies and investors on opposite sides try to work together.

On that note, the last thing I noticed at the conference is a rising geopolitical force in tech: the Middle East. A few speakers at the conference are working in Saudi Arabia and the United Arab Emirates, and they represent other deep-pocketed players who are betting on technologies like EVs and AI in both the United States and China.

But can they navigate the tensions and benefit from the technological advantages on both sides? It’ll be interesting to watch how that unfolds. 

What do you think of the role of the Middle East in the future of climate technologies? Let me know your thoughts at zeyi@technologyreview.com.

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Now read the rest of China Report

Catch up with China

1. A batch of documents mistakenly unsealed by a Pennsylvania court reveals the origin story of TikTok’s parent company, ByteDance. Who knew it started out as a real estate venture? (New York Times $)

2. Vladimir Potanin, Russia’s richest man, said he would move some of his copper smelting factories to China to reduce the impact of Western sanctions, which block Russian companies from using international payment systems. (Financial Times $)

3. Chinese universities have found a way to circumvent the US export ban on high-end Nvidia chips: by buying resold server products made by Dell, Super Micro Computer, and Taiwan’s Gigabyte Technology. (Reuters $)

4. TikTok is testing “TikTok Notes,” a rival product to Instagram, in Australia and Canada. (The Verge)

5. Since there’s no route for personal bankruptcy in China, those who are unable to pay their debts are being penalized in novel ways: they can’t take high-speed trains, fly on planes, stay in nice hotels, or buy expensive insurance policies. (Wall Street Journal $)

6. The hunt for the origins of covid-19 has stalled in China, as Chinese politicians worry about being blamed for the findings. (Associated Press)

7. Because of pressure from the US government, Mexico will not hand out tax cuts and other incentives to Chinese EV companies. (Reuters $)

Lost in translation

Until last year, it was normal for Chinese hotels to require facial recognition to check guests in, but the city of Shanghai is now turning against the practice, according to the Chinese publication 21st Century Business Herald. The police bureau of Shanghai recently published a notice that says “scanning faces” is required only if guests don’t have any identity documents. Otherwise, they have the right to refuse it. Most hotel chains in Shanghai, and some in other cities, have updated their policies in response. 

China has a national facial recognition database tied to the government ID system, and businesses such as hotels can access it to verify customers’ identities. However, Chinese people are increasingly pushing back on the necessity of facial recognition in scenarios like this, and questioning whether hotels are handling such sensitive biometric data properly. 

One more thing

The latest queer icon in Asia is Nymphia Wind, the drag persona of a 28-year-old Taiwanese-American named Leo Tsao, who just won the latest season of RuPaul’s Drag Race. Fully embracing the color yellow as part of her identity, Nymphia Wind is also called the “Banana Buddha” by her fans. She’s hosting shows in Taoist temples in Taiwan, attracting audiences old and young.

Whenever you see a solar panel, most parts of it probably come from China. The US invented the technology and once dominated its production, but over the past two decades, government subsidies and low costs in China have led most of the solar manufacturing supply chain to be concentrated there. The country will soon be responsible for over 80% of solar manufacturing capacity around the world.

But the US government is trying to change that. Through high tariffs on imports and hefty domestic tax credits, it is trying to make the cost of manufacturing solar panels in the US competitive enough for companies to want to come back and set up factories. The International Energy Agency has forecast that by 2027, solar-generated energy will be the largest source of power capacity in the world, exceeding both natural gas and coal—making it a market that already attracts over $300 billion in investment every year.

To understand the chances that the US will succeed, MIT Technology Review spoke to Shawn Qu. As the founder and chairman of Canadian Solar, one of the largest and longest-standing solar manufacturing companies in the world, Qu has observed cycle after cycle of changing demand for solar panels over the last 28 years. 

After decades of mostly manufacturing in Asia, Canadian Solar is pivoting back to the US because it sees a real chance for a solar industry revival, mostly thanks to the Inflation Reduction Act (IRA) passed in 2022. The incentives provided in the bill are just enough to offset the higher manufacturing costs in the US, Qu says. He believes that US solar manufacturing capacity could grow significantly in two to three years, if the industrial policy turns out to be stable enough to keep bringing companies in. 

How tariffs forced manufacturing capacity to move out of China

There are a few important steps to making a solar panel. First silicon is purified; then the resulting polysilicon is shaped and sliced into wafers. Wafers are treated with techniques like etching and coating to become solar cells, and eventually those cells are connected and assembled into solar modules.

For the past decade, China has dominated almost all of these steps, for a few reasons: low labor costs, ample supply of proficient workers, and easy access to the necessary raw materials. All these factors make made-in-China solar modules extremely price-competitive. By the end of 2024, a US-made solar panel will still cost almost three times as much as one produced in China, according to researchers at BloombergNEF. 

The question for the US, then, is how to compete. One tool the government has used since 2012 is tariffs. If a solar module containing cells made in China is imported to the US, it’s subject to as much as a 250% tariff. To avoid those tariffs, many companies, including Canadian Solar, have moved solar cell manufacturing and the downstream supply chain to Southeast Asia. Labor costs and the availability of labor forces are “the number one reason” for that move, Qu says.

When Canadian Solar was founded in 2001, it made all its solar products in China. By early 2023, the company had factories in four countries: China, Thailand, Vietnam, and Canada. (Qu says it used to manufacture in Brazil and Taiwan too, but later scaled back production in response to contracting local demand.)

But that equilibrium is changing again as further tariffs imposed by the US government aim to force supply chains to move out of China. Starting in June 2024, companies importing silicon wafers from China to make cells outside the country will also be subject to tariffs. The most likely solution for solar companies would be to “set up wafer capacity or set up partnerships with wafer makers in Southeast Asia,” says Jenny Chase, the lead solar analyst at BloombergNEF.

Qu says he’s confident the company will meet the new requirements for tariff exemption after June. “They gave the industry about two years to adapt, so I believe most of the companies, at least the tier-one companies, will be able to adapt,” he says.

The IRA, and moving the factories to the US

While US policies have succeeded in turning Southeast Asia into a solar manufacturing hot spot, not much of the supply chain has actually come back to the US. But that’s slowly changing thanks to the IRA, introduced in 2022. The law will hand out tax credits for companies producing solar modules in the US, as well as those installing the panels. 

The credits, Qu says, are enough to make Canadian Solar move some production from Southeast Asia to the US. “According to our modeling, the incentives provided just offset the cost differences—labor and supply chain—between Southeast Asia and the US,” he says.

Jesse Jenkins, an assistant professor in energy and engineering at Princeton University, has come to the same conclusion through his research. He says that the IRA subsidies and tax credits should offset higher costs of manufacturing in the US. “That should drive a significant increase in demand for made-In-America solar modules and subcomponents,” Jenkins says. And the early signs point that way too: since the introduction of the IRA, solar companies have announced plans to build over 40 factories in the US.

In 2023, Canadian Solar announced it would build its first solar module plant in Mesquite, Texas, and a solar cell plant in Jeffersonville, Indiana. The Texas factory started operating in late 2023, while the Indiana one is still in the works. 

The remaining challenges

While the IRA has brought new hope to American solar manufacturing, there are still a few obstacles ahead.

Qu says one big challenge to getting his Texas factory up and running is the lack of experienced workers. “Let’s face the reality: there was almost no silicon-based solar manufacturing in the US, so it takes time to train people,” he says. That’s a process that he expects to take at least six months. 

Another challenge to reshoring solar manufacturing is the uncertainty about whether the US will keep heavily subsidizing the clean energy industry, especially if the White House changes hands after the election this year. “The key is stability,” Qu says, “Sometimes politicians are swayed by special-interest groups.”

“Obviously, if you build a factory, then you do want to know that the incentives to support that factory will be there for a while,” says Chase. There are some indications that support for the IRA won’t necessarily be swayed by the elections. For example, jobs created in the solar industry would be concentrated in red states, so even a Republican administration would be motivated to maintain them. But there’s no guarantee that US policies won’t change course.

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

I don’t know about you, but I only learned last week that there’s something connecting MSG and computer chips.

Inside most laptop and data center chips today, there’s a tiny component called ABF. It’s a thin insulating layer around the wires that conduct electricity. And over 90% of the materials around the world used to make this insulator are produced by a single Japanese company named Ajinomoto, more commonly known for commercializing the seasoning powder MSG in 1909.

Hold on, what? 

As my colleague James O’Donnell explained in his story last week, it turns out Ajinomoto figured out in the 1990s that a chemical by-product of MSG production can be used to make insulator films, which proved to be essential for high-performance chips. And in the 30 years since, the company has totally dominated ABF supply. The product—Ajinomoto Build-up Film—is even named after it.

James talked to Thintronics, a California-based company that’s developing a new insulating material it hopes could challenge Ajinomoto’s monopoly. It already has a lab product with impressive attributes but still needs to test it in manufacturing reality.

Beyond Thintronics, the struggle to break up Ajinomoto’s monopoly is not just a US effort.

Within China, at least three companies are also developing similar insulator products. Xi’an Tianhe Defense Technology, which makes products for both military and civilian use, introduced its take on the material, which it calls QBF, in 2023; Zhejiang Wazam New Material and Guangdong Hinno-tech have also announced similar products in recent years. But all of them are still going through industrial testing with chipmakers, and few have recent updates on how well these materials have performed in mass-production settings.

“It’s interesting that there’s this parallel competition going on,” James told me when we recently discussed his story. “In some ways, it’s about the materials. But in other ways, it’s totally shaped by government funding and incentives.”

For decades, the fact that the semiconductor supply chain was in a few companies’ hands was seen as a strength, not a problem, so governments were not concerned that one Japanese company controlled almost the entire supply of ABF. Similar monopolies exist for many other materials and components that go into a chip.

But in the last few years, both the US and Chinese governments have changed that way of thinking. And new policies subsidizing domestic chip manufacturing are creating a favorable environment for companies to challenge monopolies like Ajinomoto’s.

In the US, this trend is driven by the fear of supply chain disruptions and a will to rebuild domestic semiconductor manufacturing capabilities. The CHIPS Act was announced to inject investment into chip companies that bring their plants back to the US, but smaller companies like Thintronics could also benefit, both directly through funding and indirectly through the establishment of a US-based supply chain.

Meanwhile, China is being cornered by a US-led blockade to deny it access to the most advanced chip technologies. While materials like ABF are not restricted in any way today, the fact that one foreign company controls almost the entire supply of an indispensable material raises the stakes enough to make the government worry. It needs to find a domestic alternative in case ABF becomes subject to sanctions too.

But it takes a lot more than government policies to change the status quo. Even if these companies are able to find alternative materials that perform better than ABF, there’s still an uphill battle to convince the industry to adopt it en masse.

“You can look at any dielectric film supplier (many from Japan and some from the US), and they have all at one time or another tried to break into ABF market dominance and had limited success,” Venky Sundaram, a semiconductor researcher and entrepreneur, told James. 

It’s not as simple as just swapping out ABF and swapping in a new insulator material. Chipmaking is a deeply intricate process, with components closely depending on each other. Changing one material could require a lot more knock-on changes to other components and the entire process. “Convincing someone to do that depends on what relationships you have with the industry. These big manufacturing players are a little bit less likely to take on a small materials company, because any time they’re taking on new material, they’re slowing down their production,” James said.

As a result, Ajinomoto’s market monopoly will probably remain while other companies keep trying to develop a new material that significantly improves on ABF. 

That result, however, will have different implications for the US and China. 

The US and Japan have long had a strategic technological alliance, and that could be set to deepen because both of them consider the rise of China a threat. In fact, Japan’s prime minister, Fumio Kishida, was just visiting the US last week, hoping to score more collaborations on next-generation chips. Even though there has been some pushback from the Japanese chip industry about how strict US export restrictions could become, this hasn’t been strong enough to sway Japan to China’s side.

All these factors give the Chinese government an even greater sense of urgency to become self-sufficient. The country has already been investing vast sums of money to that end, but progress has been limited, with many industry insiders pessimistic about whether China can catch up fast enough. If Ajinomoto’s failed competitors in the past tell us anything, it’s that this will not be an easy journey for China either.

Do you think China has a chance of cracking Ajinomoto’s monopoly over this very specific insulating material? Let me know your thoughts at zeyi@technologyreview.com.

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Now read the rest of China Report

Catch up with China

1. Following the explosive popularity of minute-long short dramas made for phones, China’s culture regulator will soon announce new regulations that tighten its control of them. (Sixth Tone)

• This is not a surprise to the companies involved. Some Chinese short-drama companies have already started to expand overseas, driven out by domestic policy pressures. I profiled one named FlexTV. (MIT Technology Review)

2. There have been many minor conflicts between China and the Philippines recently over maritime territory claims. Here’s what it feels like to live on one of those contested islands. (NPR)

3. The Chinese government has asked domestic telecom companies to replace all foreign chips by 2027. It’s a move that mirrors previous requests from the US to replace all Huawei and ZTE equipment in telecom networks. (Wall Street Journal $)

4. A decade ago, about 25,000 American students were studying in China. Today, there are only about 750. It may be unsurprising given recent geopolitical tensions, but neither country is happy with the situation. (Associated Press)

5. Latin America is importing large amounts of Chinese green technologies—mostly electric vehicles, lithium-ion batteries, and solar panels. (The Economist $)

6. China’s top spy agency says foreign agents have been trying to intercept information about the country’s rare earth industry. (South China Morning Post $)

7. Amid the current semiconductor boom, Southeast Asian youths are flocking to Taiwan to train and work in the chip industry. (Rest of World)

Lost in translation

The bodies of eight Chinese migrants were recently discovered on a beach in Mexico. According to Initium Media, a Singapore-based publication, this was the first confirmed shipwreck incident with Chinese migrants heading to the US, but many more have taken the perilous route in recent years. In 2023, over 37,000 Chinese people illegally entered the US through the border with Mexico.

The traffickers often arrange shabby boats with no safety measures to sail from Tapachula to Oaxaca, a popular route that circumvents police checkpoints on land but makes for an extremely dangerous journey often rocked by strong winds and waves. There had always been rumors of people going missing in the ocean, but these proved impossible to confirm, as no bodies were found. The latest tragedy was the first one to come to public attention. Of the nine Chinese migrants onboard the boat, only one survived. Three bodies remain unidentified today.

One more thing

Forget about the New York Times’ election-result needles and CNN’s relentless coverage by John King. In South Korea, the results of national elections are broadcast on TV with wild and whimsical animations. To illustrate the results of parliamentary elections that just concluded last week, candidates were shown fighting on a fictional train heading toward the National Assembly, parodying Mission: Impossible’s fight scene. According to the BBC, these election-night animations took a team of 70 to prepare in advance and about 200 people working on election night.

The best part of South Korean election night: the graphics. pic.twitter.com/XfFGkSD8k4

— Michelle Ye Hee Lee (@myhlee) April 10, 2024