A week after ByteDance announced a competing offering that is less expensive than other competitors, Alibaba Cloud Intelligence, the largest cloud computing service provider in China, started a pricing war by slashing rates for using its generative artificial intelligence (AI) models by up to 97%.
Liu Weiguang, president of the public cloud business disclosed that the price cuts apply to nine of Alibaba’s Qwen self-developed large language models (LLMs), also known as Tongyi Qianwen at the firm’s AI summit in Wuhan, the capital of central Hubei province, on Tuesday.
Alibaba and Tencent have just lowered the costs of their cloud computing services, continuing the price war that has been going on in China’s cloud computing market for the previous few months.
After China witnessed a flood of investment in large language models in reaction to the successful launch of US-based OpenAI’s ChatGPT in late 2022, several Chinese cloud suppliers have turned to AI chatbot services to increase sales.
Large-language models, which are the foundation of these chatbots, are now being affected by the price battle in China’s cloud computing market, which might reduce profit margins for businesses.
Corporate clients had to pay to use Baidu’s Ernie Lite and Ernie Speed until Tuesday when they were first made available.
The web search giant Baidu claimed that its Ernie Speed and Ernie Lite LLMs, both released earlier this year, are completely free of charge, just hours after Alibaba Cloud’s announcement.
In an earnings report last week, founder and chairman Robin Li Yanhong stated that the Beijing-based company is striving to lower the cost of its AI services. The company started charging 59.9 yuan per month in November for the use of its top-tier Ernie Bot 4.0.
We reported a piece of similar news that Apple is once again reducing the prices of some iPhone models in China to increase sales and strengthen its position in the competitive smartphone industry.
