Chinese AI groups have flooded the market with a series of new powerful models as they step up the battle to gain a competitive edge in the race to develop the technology.
ByteDance, Alibaba and Moonshot are among the AI labs that have unveiled new models around the lunar new year holiday, with several also launching giveaways and incentives amid an intensifying fight to attract users to their AI services.
The flurry of new releases underscores the “rising competitiveness” of Chinese labs, according to Ritwik Gupta, an AI researcher at the University of California, Berkeley.
“Chinese labs are getting better at building models that are useful for making applications. They largely view AI as a tool for building products, in contrast with the US labs, which view it as a race for “frontier” dominance first, product second,” he said.
The launch of ByteDance’s new video-generating model, Seedance 2.0, last week quickly spooked Hollywood with its ability to produce multi-scene clips with shifting camera angles, realistic imagery and synchronised sound effects.
Tiezhen Wang, an engineer at Hugging Face, described the tool as a “DeepSeek moment” for AI video generation, in a nod to the Chinese start-up whose R1 large language model last year was seen as a breakthrough for the country’s AI industry.
The rush of releases came as Chinese AI groups target a week-long holiday that has long been seen as crucial for the adoption of tech products, where potential customers have lots of free time to test and explore them.
Alibaba, which has released more than 400 open-source models since 2023, launched its latest Qwen 3.5 model earlier this week, alongside a pledge to spend Rmb3bn ($431mn) on subsidies for users buying goods through its AI app Qwen.
Users rushed to download the app to claim free bubble teas and other giveaways through its AI agent in a campaign that overwhelmed many participating stores. Rivals Tencent and Baidu also offered freebies on their AI apps to boost downloads.
Alibaba’s new model is tailored for developers building AI agents, systems that independently operate computers and complete complex tasks with only minimal user supervision.
DeepSeek was also expected to release its long-awaited new AI model, a year after it surprised Silicon Valley by developing a powerful large language model which it claimed was trained on a fraction of the compute of comparable US ones.
This sparked a focus across China’s AI industry to invest heavily in building leading models that can be cheaply deployed by developers in applications, which saw them quickly leapfrog US rivals in “open” development.
AI experts said the latest series of model launches also signals a push by Chinese groups to attract developers frustrated over usage limits and tighter controls recently introduced by US AI groups, such as Anthropic and OpenAI.
Moonshot has positioned its latest model, Kimi 2.5, which it launched in late January, as a high-performing coding system without comparable usage constraints. The Beijing-based start-up has open sourced Kimi, enabling developers to run it across a range of cloud providers or on their own servers.
“Chinese companies are clearly leaning into what developers want and building models to address that,” said Gupta. “Developers want freedom. They do not want to be locked in by any AI model provider that demands they use their services in a specific way.”
Moonshot has previously moved quickly to exploit openings created by US rivals. When OpenAI retired one of its flagship models last year, Moonshot released migration tool kits designed to help developers shift applications built on OpenAI’s systems to Kimi with minimal disruption.
An executive at US-based Perplexity, the AI search engine that allows users to switch between different underlying models, said people are increasingly choosing Chinese open-source systems.
While users have snapped up the new AI models, some of the tools also quickly generated criticism from outside the AI industry.
The Motion Picture Association, a trade association representing the large studios, last week demanded that ByteDance cease its “infringing activity” after users uploaded videos using the tech giant’s new Seedance model featuring IP from studios.
ByteDance subsequently issued a statement saying it was “taking steps to strengthen current safeguards” to prevent the “unauthorised use of intellectual property and likeness by users”.
Hugging Face’s Wang said ByteDance’s tool was a step up from earlier models that struggled with scene complexity.
In one widely shared clip, Chinese filmmaker Jia Zhangke is depicted encountering an AI version of himself travelling to well-known scenes in his films and having humorous philosophical conversations about filming and art in an AI age.
“Seedance enables users to act more like a director. It gives them control over the angle of the shot, how it is framed, where the actors are standing and the sound,” said Wang. “In short, it is a much more competitive tool for users making AI-generated content.”
