Prime Highlights:
Alibaba Cloud cuts as much as 85% of its visual language model Qwen-VL prices.
This will heighten competition among China’s tech giants, namely Tencent, Baidu, and ByteDance, in the fast-growing AI market.
Qwen-VL, developed by Alibaba, is an AI model designed to process both text and images. Unlike ChatGPT, Alibaba’s Qwen-VL was specifically created for enterprise customers, rather than as a consumer-focused AI chatbot.
Key Background:
Alibaba Cloud, the cloud computing arm of the Chinese e-commerce leader, on Tuesday announced a price cut of as much as 85% for its large language model, Qwen-VL. This is one of the most intense battles that the tech titans of China are waging in order to corner the fast-emerging artificial intelligence market.
Large language models (LLMs), which generate humanlike responses by processing vast amounts of data, are fundamental to generative AI systems, including tools like OpenAI’s ChatGPT. Alibaba’s Qwen-VL, designed to interpret both text and images, is a critical part of its strategy to dominate the emerging AI sector. The price cuts aim to attract more enterprise customers by making its AI technology more accessible.
This is against the backdrop of stiff competition between such heavyweights in Chinese tech as Tencent, Baidu, JD.com, Huawei, and ByteDance, who over the past 18 months have all debuted their LLMs. In a world where generative AI is fast becoming the bedrock of newer technologies, these companies are competing for supremacy.
Alibaba had already cut prices on a broad range of cloud products by as much as 55% in February, and by as much as 97% on its Qwen AI model in May. All these are strategic pricing actions within Alibaba’s larger effort to expand its offerings of AI for business users, rather than trying to compete directly with consumer models like ChatGPT.
Despite the declines in prices, Alibaba’s shares did not react much, closing 0.5% higher at the end of the trading year in Hong Kong. However, Alibaba Cloud’s push to make AI more affordable reflects the seriousness of the company about capitalizing on the ever-growing demand for enterprise AI applications. As of now, the company reported that its Qwen models had been deployed by over 90,000 enterprise users.
