Chinese company SenseTime’s stock surged more than 30% this week after the AI software maker introduced the latest version of its large language model (LLM), an indication of the intense interest in such technology among both Chinese investors and the country’s government.
In an event in Shanghia, the company unveiled SenseNova 5.0, the fifth iteration of an LLM that SenseTime Chairman and CEO Xu Li has said is compatible with OpenAI’s GPT-4 in most cases and better in others, including in uses particular to China.
The announcement sent SenseTime’s stock soaring so quickly the Hong Kong-based company had to temporarily suspend trading. SenseTime executives reportedly said in a filing they didn’t know why the share price surged so quickly, other than the SenseNova 5.0 announcement, adding that the LLM “achieved significant improvements in knowledge, mathematics, reasoning and coding capabilities, and its performance is generally comparable to GPT-4 Turbo.”
Li said in a statement that “in our pursuit to push the boundaries of SenseNova’s capabilities, SenseTime remains guided by the Scaling Law as we build upon our large model based on this three-tier architecture: knowledge, reasoning, and execution (KRE).”
Rapid Innovation of SenseNova
The company said SenseNova 5.0 offers advancements in such areas as knowledge, mathematics, reasoning and coding capabilities, adding that since the LLM debuted in April 2023, it has undergone more than 10 terabytes of token training that included a large amount of synthetic data. It covers both cloud and edge environments and comes with about 600 parameters.
During the event, SenseTime also announced models for AI at the edge, including its Edge-side Large Model for terminal devices and Integrated Large Model (Enterprise) edge device that can be used in such fields as financing, coding, health care and government services.
SenseTime executives also boasted of the LLM’s multimodal capabilities, including the ability to generate text and images, similar to what OpenAI can do with such generative AI software as ChatGPT and Sora, and Google can do with Gemini.
“It supports high-definition image parsing and understanding, as well as text-to-image generation,” the company said in a statement. “In addition, it extracts complex data across-documents and summarizes answers to questions, possessing strong multimodal interaction capability.”
China’s Focus on AI
As in the United States and other countries, AI – and in particular generative AI – has become a focus in China. According to a joint report in December by KPMG International and the ZGC Industry Institute in China, as of June 2023, there were 5,734 AI companies in China, or about 16% of the world’s 36,000 such businesses. About 13,000 – or 33.6% – were in the United States. Market research firm Blue Weave Consulting wrote that China’s AI market last year hit $29.02 billion and could go as high as $104.7 billion by 2030.
SenseTime joins other high-profile Chinese companies, such as Baidu, Alibaba, and Tencent in developing its own generative AI platform. The company for several years was known for its AI-based facial recognition technology before catching the generative AI wave after OpenAI released ChatGPT in November 2022.
The Geopolitics of AI
Like its compatriots, SenseTime also has been affected by the furious technology competition between China and the United States. The Chinese government for more than a decade has encouraged Chinese companies to develop homegrown technologies, from infrastructure like chips to software, and AI in recent years has been no exception.
However, U.S. lawmakers over the past several years have grown wary of Chinese technology use in the country, worried that the close ties many Chinese companies have with the Chinese government make such products a national security threat. The United States’ campaign has included tightening sales of chip-making equipment – and AI chips – to China.
That said, Reuters reported this month that almost a dozen Chinese entities – including universities and research firms – were able to obtain through resellers advanced Nvidia GPUs crucial to AI systems that already were embedded in systems from vendors like Dell, Super Micro, and Gigabyte Technology despite the expanded and updated embargo on such chips to China. Such restrictions reportedly have put China well behind the United States in the global AI competition.
The United States in recent years also has sanctioned a number of Chinese tech companies, making it more difficult for those firms to do business in the country or access its technologies. Huawei reportedly has been shedding public and government relations jobs in the United States after giving up hope that the country will loosen its restrictions.
SenseTime as well as others, including Huawei, have been sanctioned by the United States, which helped lead to SenseTime seeing an 80% drop in it market value since its IPO in 2021, according to Bloomberg. There’s some speculation that the dramatic rise in the company’s stock this week was in part due to its already low valuation.
