Alibaba Unveils Qwen 2.5 AI Model to Compete with DeepSeek-V3 in the Innovation Race
Alibaba announced on Wednesday the launch of its new artificial intelligence model,
Qwen 2.5, in a move aimed at challenging the Chinese competitor DeepSeek-V3,
which has recently garnered widespread attention due to its technical superiority and low operational cost.
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Alibaba
The announcement of the new Qwen 2.5-Max model came at the start of the Chinese Lunar New Year,
an unconventional timing for major releases.
This reflects the mounting pressure created by DeepSeek’s rapid success,
which has forced major players in the Chinese AI market to accelerate their innovations.
Alibaba’s cloud computing division confirmed on WeChat that Qwen 2.5-Max “outperforms GPT-4o, DeepSeek-V3, and Llama-3.1-405B”,
making it a formidable competitor in the open-source AI landscape.
Rising Competition
The launch of DeepSeek-V3 on January 10, followed by the release of DeepSeek-R1 on January 20,
sent shockwaves through Silicon Valley, leading to declines in the stock prices of major tech companies.
This disruption was driven by DeepSeek’s highly efficient model with low operational costs,
prompting investors to reassess the massive spending plans of U.S. AI firms.
The impact wasn’t limited to global players; Chinese tech companies also accelerated the development of new models.
Just two days after DeepSeek-R1’s release, ByteDance—the parent company of TikTok—announced a major upgrade to its AI model,
claiming that it outperformed OpenAI’s o1 in the AIME test,
a benchmark for evaluating an AI model’s ability to comprehend and execute complex instructions accurately.
Price War
The launch of DeepSeek-V2 in May 2023 was a game-changer in China’s AI market,
as it was introduced as an open-source model with an unprecedented price of just 1 yuan ($0.14) per million tokens.
This aggressive pricing strategy put immense pressure on major firms like Alibaba,
which responded by cutting its cloud service prices by up to 97%.
This forced competitors like Baidu and Tencent to take similar measures to maintain their competitiveness.
DeepSeek
In a rare interview with the Chinese platform Waves, Liang Wenfeng,
the enigmatic founder of DeepSeek, stated that his company is not concerned with price wars.
Instead, DeepSeek is focused on achieving Artificial General Intelligence (AGI)—the next frontier in AI
that aims to surpass human intelligence across most core economic tasks.
Liang further noted that despite having vast resources,
large corporations like Alibaba may struggle to lead the future of AI due to high operational costs
and traditional corporate structures.
Alibaba Unveils Qwen 2.5 AI Model to Compete with DeepSeek