00:00China doesn't want any foreign hardware in its public authorities.
00:03China is building a more nationalistic approach as the chip controls continue to increase.
00:10And that could have far-reaching consequences.
00:13Many people call it a tech Cold War.
00:17Where will this ultimately lead? And why will the military play a decisive role?
00:22China's public authorities are still using hardware and software from the West.
00:27Replacing it with Chinese products is a priority. But what is behind this?
00:32China has been trying to replace Western technology for a pretty long time.
00:37Partly because of the Snowden leaks and what it revealed around US espionage with US technology.
00:44But is it technically possible?
00:49Especially graphics processing units, the things the US is now restricting from exporting to China.
00:54Those are one of the hot points where there will still be problems.
00:59And in addition, of course, Chinese companies can choose Chinese products,
01:05even if they're not as good as foreign products, as long as they're good enough to do what you need to be doing.
01:13And how is the US reacting? In a word, tick-tock.
01:17The US government is demanding that it be sold to an American company.
01:21Otherwise, they are threatening to ban it from US app stores.
01:25The US wants to protect user data from being accessed by the Chinese authorities.
01:30Then there's NVIDIA. The US manufacturer's most advanced high-tech chips are not allowed to be sold to China.
01:38The goal is to deny China access to the latest high-tech.
01:42US companies are being threatened with stiff penalties.
01:47If China is able to move even a handful of percentage points off of US-based semiconductors,
01:54for instance, to do semiconductors that can be developed and built in China,
01:59that will mean billions of dollars of revenue for these US-based companies.
02:04No company wants to be locked out of the lucrative Chinese market.
02:09Of course, you're seeing the US-based companies are continually playing a bit of a cat and mouse game with the US
02:16and with China to build semiconductors that fall beneath the regulations,
02:19so that they are able to ship product into China.
02:23Having said that, with more and more pressure, those bars continue to be moved.
02:29China, therefore, wants to catch up technologically, quickly.
02:33It's pumping up its startups with the equivalent of billions of euros,
02:37especially in China's Silicon Valley to the north of Beijing.
02:41Because whoever has the most powerful IT will also have the strongest army in the future.
02:48What we are seeing is China making progress.
02:50We know they're willing to invest to almost no end,
02:53because this isn't just about a little bit of a geopolitical tension.
02:57This is about global economic leadership in technology and in AI.
03:01And AI is going to be the most important front in which economics are fought
03:06in terms of a battle for domination globally over the next two, three decades.
03:12China is still behind.
03:14But if it were to play a leading role in AI,
03:16it would also be able to sell its IT products and applications abroad.
03:22I am totally convinced we're going towards two ecosystems.
03:25And the question is, I mean, beyond China's huge economies of scale,
03:31given the size of the country, can they impose their standards, their systems beyond borders?
03:38And I think that's a big fight.
03:41The US versus China.
03:43Experts believe it will be several years, however,
03:46before the Chinese are technologically on par.
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