Alibaba’s latest AI model puts it back in the great game

{"text":[[{"start":4.18,"text":"Chinese tech companies are light years ahead of their US peers when it comes to making investors feel disenchanted. Nine years ago, Alibaba and Amazon both sported market capitalisations just shy of $500bn. Today, Amazon is worth $3tn; Alibaba a tenth of that."}],[{"start":22.98,"text":"The Hangzhou-based ecommerce and cloud company hopes to recoup some of its lost shine with Monday’s release of its latest AI model, Qwen 3.8-Max. Alibaba is making big claims about its capabilities. Early benchmarking suggests it’s good — if not the best — in some areas such as “agentic coding”, where bots write and fix code unassisted."}],[{"start":44.72,"text":"To be clear, Alibaba’s woeful share performance owed less to a perceived AI deficiency and more to political troubles. At home, Beijing spent years reining in the company and fellow tech titan Tencent. Overseas, the US restricts China’s access to advanced chips and other technology. Last month, the EU handed Alibaba a hefty fine for failures on its online marketplace."}],[{"start":68.14,"text":"And like its peers in the US, Alibaba is spending liberally. While nothing like the outsized bills of its US peers, capital expenditure of $18.3bn in its last accounting year left the company with negative free cash flow. Inflows are expected to return this year, but won’t surpass 2024 levels until 2031, according to Visible Alpha estimates."}],[{"start":null,"text":"

"}],[{"start":90.34,"text":"Alibaba can at least make a good case for spending money on its own AI. Its ecommerce operation usually throws off cash, and its fast-growing cloud computing division gives it more opportunities to monetise its models. Like Microsoft, Alibaba offers “model as a service”, giving smaller companies cloud-based access to pre-trained models, which they can then deploy, as chatbots perhaps, paying according to their usage."}],[{"start":115.02,"text":"Counter-intuitively, the bifurcated tech world that splits China from the US can also work to China’s advantage. It has forced innovation: like Google, Alibaba has its own proprietary chips. And US hardware makers need local partners. Apple won approval to launch AI-embedded devices in China using local tech, including Qwen."}],[{"start":134.18,"text":"Alibaba chief Eddie Wu thinks AI models and services will make up half of external cloud income by 2027 — about a tenth of total sales, Lex reckons. That’s not huge but it is a useful launch pad. Qwen is open weight, so users can’t totally replicate it, making it more commercial than previous open-source models. The race isn’t just to make top-of-the-range AI, but to make AI that pays its way; don’t count Alibaba out on that score."}],[{"start":165.14,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1786076653_5936.mp3"}