Chinese technology giants are engaged in a high-stakes battle for artificial intelligence supremacy, committing billions of yuan in promotional spending to capture users during the extended Lunar New Year holiday. Alibaba Group has announced the most aggressive campaign, pledging 3 billion yuan (approximately $431 million) to promote its Qwen AI chatbot. This spending significantly outpaces commitments from rivals Tencent, which pledged 1 billion yuan for its Yuanbao chatbot, and Baidu, which committed 500 million yuan for similar promotions.
The promotional campaigns are strategically timed for the nine-day Lunar New Year public holiday beginning February 15, which is longer than in most previous years. Alibaba's campaign starts on February 6 and will offer rewards tied to dining, drinks, entertainment, and leisure activities through the distribution of "large red envelopes." The company has not specified whether these rewards will be direct cash payments or discount coupons redeemable on its platforms like Taobao.
This marketing blitz follows a proven playbook in Chinese tech. The most famous example occurred in 2015 when Tencent used its WeChat platform to distribute digital red envelopes, a strategy that helped its WeChat Pay service gain significant ground against the then-dominant Alipay. Tencent's current campaign for Yuanbao requires users to update to the latest app version to claim red envelopes, which can be withdrawn to WeChat wallets, and allows users to share links with cash rewards to spur viral growth.
The intense competition has accelerated since the January 2025 launch of DeepSeek's R1 model, which disrupted global AI markets and spurred domestic players to accelerate their own development and launch schedules. In response to this heated environment, several AI firms are preparing to release upgraded models just before the holiday. DeepSeek is expected to launch its next-generation V4 model around mid-February, reportedly with strong coding capabilities. Meanwhile, Zhipu AI (operating as Z.ai outside China) plans to launch its GLM-5 model within the next two weeks, and Shanghai-based MiniMax is set to release its M2.2 update, both focusing on enhanced performance in areas like coding and reasoning.
The massive financial commitments and coordinated model launches underscore the strategic importance Chinese tech companies place on the AI chatbot race. They are betting that a strong showing during the peak user engagement period of Lunar New Year can be decisive in converting casual users into regular ones and securing long-term market share in this critical technological frontier.
