Chinese tech giants Alibaba, Tencent, and others invest in Zhipu, China’s AI contender to OpenAI

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Zhipu, a rising star in China’s artificial intelligence landscape, recently announced substantial financial backing from tech giants like Alibaba and Tencent, marking an investment of over 2.5 billion Chinese yuan ($341 million) this year. Sequoia and Hillhouse are prominent venture backers, while Xiaomi, Alibaba, and Tencent are among the corporate investors joining the league.

Zhipu is at the forefront of China’s burgeoning AI startups, specializing in developing AI models trained on extensive data sets for diverse applications. In August, Zhipu unveiled a generative AI chatbot, showcasing its AI capabilities in generating responses to user queries.

This development takes place in the midst of the ongoing technological rivalry between the United States and China, with AI at the epicenter. China views AI as a pivotal technology with the potential to boost its economic output. The nation has plans to increase its computing power by 50% by 2025, thereby fostering AI application development.

Conversely, the United States has implemented measures to restrict China’s access to vital technologies required for AI model development. Notably, the U.S. introduced rules that limited Nvidia’s sale of top-end A100 and H100 graphics processing units to China, with recent expansions of these restrictions to encompass more Nvidia chips. Nvidia, a leader in graphics processing units, plays a critical role in training data-intensive AI models. Zhipu is just one of the many Chinese startups aimed at bolstering the country’s AI industry, with backing from China’s tech giants.

In a parallel move, Baichuan, another AI startup, disclosed raising approximately $300 million in funding, with investments from Alibaba and Tencent, demonstrating the robust interest in AI innovation within China.

Furthermore, companies like Alibaba, Tencent, and Baidu are actively engaged in developing their AI models and rolling out products rooted in this transformative technology, intensifying the competition in the AI landscape.

(Source: Arjun Kharpal | CNBC | Jane Zhang | Bloomberg)

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