So the Americans were caught almost completely off guard in October 1957, when the Soviet Union successfully launched Sputnik-1<\/a>, the world\u2019s first ever artificial satellite, into orbit. <\/p>\n Today, the US is locked in competition with a different superpower: China. In recent years, China has given the world some surprise breakthroughs of its own \u2013 from advanced hypersonic missiles<\/a> to cutting-edge computer chips<\/a> and powerful artificial intelligence (AI) models<\/a>. <\/p>\n The question is, how did China get there \u2013 and what can other countries like Australia learn from it?<\/p>\n Decades in the making<\/p>\n A recent study<\/a> by the National Bureau of Economic Research (NBER) in the US sought to better understand Chinese innovation by examining about 14 million Chinese patent publications from between 1985 and 2023. <\/p>\n Its findings suggest these modern \u201cSputnik moments\u201d were not isolated strokes of luck, but were instead decades in the making. <\/p>\n The study<\/a> noted that Chinese patent activity in critical technology areas<\/a> (as defined by the US Department of Defense) has been growing.<\/p>\n The number of new patents has steadily increased from fewer than 10,000 annually in the early 2000s to more than 400,000 in 2022. <\/p>\n A related report<\/a> by the Australian Strategic Policy Institute suggests China now leads globally in 69 of 74 critical and emerging technology domains.<\/p>\n In 2021, China conducted a major test of the DF-17 missile (model seen on left), a nuclear-capable weapon that can travel at more than five times the speed of sound. Quality and quantity<\/p>\n When looking more closely at the recent NBER study<\/a>, a few interesting insights emerge.<\/p>\n First, it reveals China hasn\u2019t just been filing an increasing number of low-quality patent applications. On a measure that tracks whether novel ideas influence later inventions, Chinese patents steadily gained ground relative to US patents.<\/p>\n Second, it hasn\u2019t just been a few \u201cnational champion\u201d organisations driving China\u2019s patenting activity. Quite the opposite. <\/p>\n The ten largest owners of critical-technology patents only held 4% of all Chinese patents in 2022. That\u2019s markedly different to the US, where the ten largest owners held 20% of all patents.<\/p>\n And there are big differences on a third point, too \u2013 the role of universities. While the private sector accounts for 58% of China\u2019s critical-technology patents, 27% of patents originate from Chinese universities. <\/p>\n That\u2019s in stark contrast to the US, where universities account for only 3% of critical-technology patents. <\/p>\n The role of public research<\/p>\n History suggests that this pattern may not be unique to China. In her 2013 book, The Entrepreneurial State<\/a>, US-Italian economist Mariana Mazzucato challenges the myth that individual entrepreneurs and firms develop major breakthroughs on their own.<\/p>\n Apple launched the first iPhone in 2007. She argues many technological breakthroughs in the US depended on the long-term accumulation of inventions and capabilities across various actors. And importantly, that publicly funded research often also played a major role. <\/p>\n For example, drawing on the iPhone as a breakthrough product, Mazzucato shows that many of the technologies that made the iPhone possible \u2013 from touchscreens to GPS<\/a> and even its voice assistant Siri<\/a> \u2013 had been developed across different, often publicly funded, research institutions before the iPhone was even conceived.<\/p>\n How does Australia compare?<\/p>\n Australia has had a strong track record of invention and scientific discovery in the past. But we\u2019re increasingly struggling to keep pace with the world\u2019s technological leaders.<\/p>\n Australia does still punch above its economic weight in some specific critical technology areas. <\/p>\n For instance, since 2000, Australia accounts for almost 9%<\/a> of patents in critical-metals refinement for batteries. Australia also ranks 12th globally<\/a> in the number of quantum-computing patents.<\/p>\n And Australia has had some big innovation success stories in the past. A form of solar cell developed at UNSW in the 1980s now powers more than 90%<\/a> of new solar panels around the world. <\/p>\n The wireless local area network (WLAN) technology that made modern wifi fast and reliable was also developed here, by the publicly funded CSIRO<\/a>. <\/p>\n A troubling trajectory<\/p>\n However, Australia\u2019s current trajectory in technology development is somewhat concerning.<\/p>\n Relative to the size of its economy, Australia\u2019s spending on research and development has fallen<\/a> from 2.24% of gross domestic product in 2008\u201309 to 1.69% in 2023\u201324. <\/p>\n Simply increasing spending on research and development may not be enough. New inventions and capabilities also need businesses with the people, expertise and resources to absorb them and develop them further. <\/p>\n Here, Australia appears comparatively weak. Australian businesses employ only around 3 researchers<\/a> per 1,000 employees, compared with an OECD average of 6.5.<\/p>\n This suggests Australia might have less capacity to turn technological breakthroughs into commercially viable products and services compared with the rest of the world.<\/p>\n Lessons for other countries<\/p>\n This doesn\u2019t mean Australia or other middle powers need to invent and build every critical technology domestically to benefit. <\/p>\n![\"Models](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/08\/file-20260826-60-46y4e9.jpg\")
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\n CFOTO\/Future Publishing via Getty Images<\/a><\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/08\/file-20260826-50-v532pj.jpg\")
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\n Paul Sakuma\/AP<\/a><\/p>\n