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China’s AI dragons risk choking each other
DeepSeek has spurred a booming artificial intelligence sector. Intense competition risks a race to the bottom.
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DeepSeek and open-sourcing breakthroughs have made some headway in cutting down on costs, but eventually something will have to give.
PHOTO: REUTERS
Catherine Thorbecke
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It’s a story that has played out many times in the history of China’s tech sector. Notoriously fierce competition means that whenever a new craze comes along, scores of rivals emerge ready to pounce.
Firms are then locked in a race to the bottom when it comes to pricing. The food delivery wars forced out smaller players over the years and led bubble tea – another consumer fad fallen prey – to be sold in June for as little as 1.68 yuan (about 30 Singapore cents). A similar cut-throat market has left behind a trail of zombie cars in the electric vehicle sector. Now the same forces are in full swing in the booming artificial intelligence (AI) industry.
