China too has zealously pursued generative AI. Every other day we hear a new product announcement either from some startup or an established tech giant. Perhaps all of them may not survive, and a shakeout is imminent.

OpenAI ChatGPT introduced in late November, 2022 set China on a course of war of AI models. Tencent, Alibaba and Baidu all entered the race with their own offerings.

You will be surprised to know that there are at least 130 large language models (LLMs) in China. It constitutes 40 per cent of the global total. It is just a notch behind the US share of 50 per cent of the global total. China is in a close race. In addition, there are industry- specific fine tuned LLMs linked to the core model.

All these models may not be viable businesses. They are clones of each other, and they are not cost effective. It is difficult to speculate which models will survive in the long run. Maybe, only two or three general purpose LLMs will remain viable and will command the market.

Investors rely upon the experience of the founders before investing in these startups. Z&Y decided to back Baichuan Intelligence who has introduced an open source AI model on the lines of Llama 2. Baichuan’s founder is Wang, who floated a search engine — Sogou, and whose company was approved for releasing a chatbot. Google’s employees in China too are setting up some startups. Chines big tech Alibaba, Tencent and Baidu can have a head-start, and can offer generative AI as an additional plug-in.