AI Giants Fuel Lunar New Year Frenzy with Billions in Giveaways

As Lunar New Year celebrations begin, China's leading technology firms are waging a multi-billion dollar battle for the future of artificial intelligence. The holiday, a peak period for consumer spending and digital engagement, has become the stage for an unprecedented promotional blitz.

ByteDance, the company behind TikTok, is offering 100,000 prizes, including luxury cars, during the national holiday gala to promote its Doubao AI model. Rivals are raising the stakes. Baidu has set aside $72 million for its Ernie chatbot, Tencent committed $145 million for Yuanbao, and Alibaba is spending a staggering $434 million to attract users to its Qwen model. The demand was so intense that Alibaba reported having to urgently add server capacity to handle user surges.

Analysts view this spending as a critical land grab. "They are in a high-stakes race to capture users and build developer ecosystems before rivals lock in market dominance," said Charlie Dai of Forrester. "The problem is that profitability and sustainable business models remain unclear, for every major player in the global market."

The competition extends beyond giveaways. ByteDance recently launched Seedance 2.0, a video generation model aimed at professional filmmakers. A clip it produced featuring AI-generated versions of Tom Cruise and Brad Pitt gained rapid attention, even drawing a public note from Elon Musk that "It's happening fast." Other firms, including Zhipu AI and MiniMax, have also released new models, with DeepSeek and Alibaba expected to announce their own soon.

This aggressive, subsidy-driven push mirrors earlier Chinese industrial campaigns in sectors like solar panels and electric vehicles. The government is actively involved, with Premier Li Qiang recently chairing a session calling for accelerated large-scale commercial AI application. For now, the immediate goal is clear: secure users first, and figure out the business model later.

Source: CNBC