By Anushka Rajvedi
China has shocked the world as it has developed a new AI software called, ‘Qwen 2.5’, which claims to surpass even the recent AI development of China, ‘DeepSeek’.
Alibaba, China’s tech company, has developed a new AI model ‘Qwen 2.5’, which the company claims to ‘outperform every other AI generative model, along with China’s most recent invention, DeepSeek.’ The Chinese tech market has been sending shock waves to the global market since the beginning of the year. 10 days ago, China launched its new AI model ‘DeepSeek’, at a fraction of cost and resources and now it has introduced Alibaba’s ‘Qwen 2.5’.
The AI price war has sparked domestic competition in China. Alibaba released its new AI model at a very unusual time, the Lunar New Year of China, to create pressure on ‘DeepSeek’ which has risen immensely in the past three weeks. Alibaba has poured a significant amount of resources into its cloud services and has reduced its market price to attract more users.
Marc Andreessen, the investor of Silicon Valley has described this development of China’s AI industry as a ‘Sputnik Moment.’ This development has challenged the technology of the US, as the company used only 2000 chips to create such technology, unlike the US and other countries that have used more than 16,000 chips to develop their AI generative tool. The markets were further shocked when it was revealed that ‘DeepSeek’ trained its AI model with only $6 million, unlike OpenAI, which used $1 Billion to train ChatGPT.
With China developing models like ‘DeepSeek’ and ‘Qwen 2.5’, it has reshaped the entire AI market which was supposedly driven by high funding.
The US was the leading market for AI technology until two years ago, followed by China. To prevent China from further developing its technology, in 2022, the US restricted exports of chips to China. The US market claimed that it was Nvidia, a chip-maker company’s semiconductors that are required to develop such complex AI models. However, Deepseek and Qwen 2.5 proved these claims false.