China’s ambition in artificial intelligence is often framed as a tech rivalry between two important centers for digital innovation — the east coast of China and the U.S. West Coast. But this rivalry is an undercard for the main event: AI’s largest and most enduring contributions will be in non-technology sectors, as traditional companies unlock value in regions far away from Silicon Valley and the string of coastal cities that constitute China’s innovation corridor.

For non-tech sectors, our research indicates that Chinese companies’ approach to adopting AI differs from those in other regions, raising important questions. Buoyed by the country’s latest five-year plan and enabled by centralized data, these companies are investing aggressively in AI and adapting their business models to accommodate for AI’s potential. However, AI adoption in China is experiencing noteworthy challenges in the form of unclear business cases and bottlenecks due to a lack of technical capabilities. In addition, Chinese companies’ current focus on AI’s potential to aid cost reductions could be partly to blame for expectations of job losses. Regardless of any setbacks in Chinese companies’ momentum, the determination they’re using toward AI adoption could stimulate other governments and companies to ensure their stakes in this competition.