US-China AI rivalry intensifies as American companies adopt Chinese technology
Despite geopolitical tensions between the United States and China over artificial intelligence development, Chinese AI technology is increasingly gaining adoption among American companies and organizations.
In January, DeepSeek launched its R1 large language model, demonstrating that advanced AI technology is not exclusive to American companies. Chinese open-source AI models from companies like Alibaba and DeepSeek are becoming increasingly popular in the US market because they offer flexibility and cost-effectiveness. Usage of Chinese AI models has grown dramatically from 1.2% in late 2023 to nearly 30% in August 2024.
Many American organizations, including Nvidia, Perplexity, and Stanford University, have integrated Chinese AI models into their operations. One American entrepreneur reported saving $400,000 annually by switching to Chinese alternatives. Beyond language models, Chinese companies are also advancing in AI agent development.
This trend reflects a shift in the AI landscape, where open-source approaches are challenging the traditional dominance of US tech giants.
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