AI Battle Heating Up: 1. America & 2. China

China just released updated AI models like Kimi AI and Z.ai that are apparently very close to Claude AI (Anthropic) in reasoning ability. Many paid for Claude's style of features, are available in the free open source plans from China.
The computing cost is also substantially less if you want to use the API for business - rather than the ChatBot

They have open-source models providing many of the features in Claude AI.

DeepSeek is more like ChatGPT, which uses memory to provide fast responses.
ChatGPT is reducing the number of words (tokens) it returns, for example, writing text over 3000 words, even on paid plans. Deep Seek will write tens of thousands of words, even on free plans.

Europe remains miles behind. However, Mistral is decent.
Also, one of the founders of DeepMind in the UK has left to start up his own AI company to develop a UK model.
Others in the East are developing their own models, like South Korea, which just made an over 1 trillion investment.

Big Tech are shitting itself.... America has poured trillions into generative AI, but its returns are starting to look very risky. A mass of Data Centers have been built across the US.

Kimi K3 from China has caught up to the latest modules with inferior hardware. Once they have the same capacity, their models should surpass those of Big Tech. The open-source software models are looking very good, compared to closed-source. Other models are closing the gap quickly, and could commoditise the market.

Kimi is a third of the cost of the latest Anthropic models for AI tokens via the API/Cloud.
Microsoft have already said they are exploring a partnership with Kimi.

Other models like DeepSeek and Z.ai are about 1/30th the cost of ChatGPT. So for every 30 Dollars of US spending, Chinese models are charging just 1 dollar.

Cheap energy and a total disregard for intellectual property.

I agree that China loves to steal intellectual property and then work out ways to mass-produce it to bring the cost down and then price the competition out of the market.

Additionally, they have two currencies, with the international currency kept at a lower value than the domestic one. This allows the Chinese to have purchasing power, which allows them to sell at below-market rates due to the low currency value.

However, I am glad to see there is some international competition with AI.
Europe needs to pull its finger; it is too far back. I still think starting to block Big Tech will create space in the marketplace.