Video: Facial recognition is on the rise in China

While the North American facial recognition technology market remains the world’s largest, China is developing new technologies at an unmatchable pace. Last year according to CB Insights, Chinese entities filed for 530 camera and video surveillance patents, while U.S. entities filed for only 96. Megvii is thought to be the first facial recognition “unicorn.” Three […]

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Forget QR codes, China’s next favorite payment method is your face

The launch of Apple’s new iPhone X equipped with tech that turns your face into a poop emoji seems to have left China’s consumers less than impressed. This shouldn’t surprise us—authentication through facial recognition and other biometric features has been gaining traction in China for quite some time. From fighting toilet paper thieves with dispensers equipped with facial recognition to WeChat’s new feature that allows hotel guests to check-in with a face scan, tech giants such as Tencent, Alibaba, and Baidu, as well as AI companies like Face++ and SenseTime (商汤科技), have been finding new ways to bring biometric technology to consumers.

“Both the private sector as well as state institutions implemented various types of biometric identification (BI) infrastructure, e.g. facial recognition in retail and fast foods, voice recognition in commercial customer service centers, fingerprint scanning at immigration checkpoints and many others,” Filip Kratochvil, former CEO of Shenzhen Neo Credit (小牛分期) told TechNode.

Boosted by the government-backed artificial intelligence pivot, China is currently among the world’s top developers of biometric identification technology. Along with an ample amount of tech developers and government support, the field is expanding thanks to looser privacy policies compared to other countries, according to Kratochvil.

Besides government projects such as biometric ID cards, facial recognition security checks and social benefits access (in Chinese), the biggest biometric boom is happening in payments. Big financial institutions such Citibank, Union Pay and HSBC had led the way in BI.

But more interesting experiments are happening on the ground in China. Alipay recently introduced its “Smile to Pay” facial recognition system for customers at a KFC fast food restaurant in Hangzhou. Baidu ran a similar trial earlier this year.

Alibaba's  “Smile to Pay” facial recognition system. Screenshot from Alibaba's promotional video.

Alibaba’s “Smile to Pay” facial recognition system. Screenshot from Alibaba’s promotional video.

An even more innovative application of facial recognition is being witnessed in China’s unmanned stores. Unlike BingoBox and Alibaba’s Hema that use apps for payment, Suning’s new unmanned store allows customers to “link” their face to Suning Finance’s app meaning that shoppers are able to pay just by showing their face to the scanner while the products are automatically scanned by the product sensor and billed.

Biometrics are also becoming mainstream in fintech with companies such as Neo Credit that use face recognition to offer financing. Even a non-tech company like PingAn Insurance has been investing in facial recognition tools which will enable it to give out loans in six minutes. Kratochvil believes that BI tools will replace credit cards, NFC chips, and QR in China.

“Look at the Chinese adoption of mobile payments and QR codes,” said Kratochvil. “The spread of mobile payments throughout the whole of China was faster than anywhere else in the world thanks to WeChat Payment and Alipay. The common adoption of biometric identification will require large investments in BI scanning devices and underlying data and technology infrastructure, but who else in the world than the Chinese technology giants would be able to invest massively and roll it out fast?”

Of course, many are cautious about biometric technology given its possible adverse effects on privacy. Chinese have traditionally been more open to new technologies and less concerned with privacy than their western peers—61% of Chinese believe we will use only biometrics to access banking services in the next ten years, according to HSBC’s Trust in Technology report. However, the arrival of the iPhone X has triggered debate in China.

One of the more vocal critics is Tan Jianfeng, founder of encryption technology company PeopleNet and President of Shanghai Information Security Trade Association. According to him, biometric authentication brings hidden dangers.

Suning's unmanned store. Image credit: Suning

Paying at Suning’s unmanned sports equipment store. Image credit: Suning

“We have unique faces, fingerprints, and irises—it is the uniqueness of biometrics that makes people think biometric authentication is safe,” said Tan in a statement for China News (in Chinese). “But because of this, the risks are even greater. Once biometric libraries are breached and biometric data are stolen they can never be restored. This is the real weak spot for biological certification.”

Tan warned that online companies should not use the technology as a gimmick to attract consumers, adding that tech companies such as these have huge pools of user data which are in danger of leakage. After all, biometric information is transmitted through the Internet as a code and as such, it can be intercepted and reconstructed by hackers.

Kratochvil agrees that we will see more biometric ID cyber crimes in the future and news reports confirm that. Drivers registering through ride-hailing app Didi have recently discovered that their ID has been hijacked despite the fact that Didi uses facial recognition to verify drivers’ identity. Other reports have also shown that data privacy is one of China’s weak points.

Others are taking it more lightly. As one Weibo commentator wrote: “Time can change faces, especially for those who love plastic surgery.”

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Qihoo 360 Gears Up For Smart Driving With AI Research Institute

Qihoo 360, a Chinese tech company best known for its anti-malware software, is turning over a new leaf in product development.

Following the lead of other Chinese tech giants, Qihoo 360 launched its own AI research institute and is looking at developing smart driving applications.

“We have a very clear and long term target,” Shuicheng Yan, the Chief Scientist at Qihoo 360’s AI research institute, told TechNode. “Definitely it’s for smart driving. […] From product’s perspective, I consider smart driving as a major focus on the whole research institute.”

Leveraging Dr. Yan’s academic background in computer vision and deep learning, Qihoo 360’s AI research institute will primarily focus on image and facial recognition. While strengthening Qihoo 360’s existing IoT portfolio is the institute’s priority, Dr. Yan’s team is also looking at using AI to improve driver safety.

Qihoo 360 will start at the “zero level” of autonomous driving, he says, with advanced driver assistance systems (ADAS), including a rear-view mirror that helps people drive more safely. The company also plans to develop products that monitor driver behavior and assess the environment around the vehicle.

The company is also taking advantage of their own strengths in security.”If you have various connections within the car [or] if you want to connect [your entertainment system] to the internet, definitely you will have the security threatened,” says Dr. Yan.

Qihoo 360 plans to develop security software reminiscent of the company’s “Safety Bodyguard” [our translation] anti-malware mobile app. However, whether or not Qihoo 360 will go as far as to develop their own fleet of autonomous cars, similar to that of Baidu or Google, is still under discussion. The company also plans to conduct their own research on voice and speech recognition, but under a separate research organization, says Dr. Yan.

Pivoting To IoT

Qihoo 360’s smart driving plans are part of the company’s overall goal to focus on connected devices. At the Second World Internet Conference last December, Zhou Hongyi, chairman and CEO of Qihoo 360, dubbed IoT the best business opportunity in the next five years. In many ways, the company’s AI research institute will be an extension of its IoT product development unit.

“We mainly support the two major lines of products of the company,” says Dr. Yan. “One is smart devices, IoT. Another line is the livestream[ing].”

Dr. Yan’s team is improving the facial recognition features of Qihoo 360’s smart home security camera, “Small Water Droplet” (小水滴, our translation). For Qihoo 360’s livestreaming platform, Huajiao (花椒), the research institute will enhance face tracking features, such as beauty and face swapping filters. At the moment, fundamental research is not a priority, says Dr. Yan.

IoT and AI could generate new revenue streams for Qihoo 360, whose main source of revenue comes from advertising on platforms like 360 Search and 360 Mobile Assistant, Qihoo 360’s mobile app store. Last year, online advertising services accounted for 67.1% of the company’s total revenue. In contrast, revenue from smart hardware and IoT devices was about 3% of Qihoo 360’s 2015 revenue, 88% of which was cost.

Qihoo 360 will also face steep competition from more established players. Other domestic tech giants, such as Alibaba and Baidu, started investing in AI years ago, either through partnerships, such as Alibaba’s partnership with facial recognition company Face++, or their own proprietary research labs, such as Baidu’s Institute of Deep Learning.

As the new kid on the block, Qihoo 360 will not only have to boost AI capabilities of existing products to survive, but develop cutting edge applications of its own.

Disclaimer: Although Qihoo 360 provided no editorial control over this post, the company covered the travel expenses involved in interviewing Dr. Shuicheng Yan.

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