In China, competition over Generative AI is heating up ahead of Lunar New Year. Last year the rivalry was limited to chatbots, but recently it has expanded into a battle for platform dominance. China's big tech companies are rolling out Lunar New Year promotions, including "cash giveaways," signaling a push to move beyond showcasing technology and increase artificial intelligence (AI) touchpoints across every part of users' daily lives.
According to China Business News and other Chinese business media on the 4th, Tencent (腾讯) and Baidu (百度) opened the first round in the Lunar New Year promotion battle. Tencent's AI service Yuanbao (元宝) launched a cash "hongbao (红包)" event on the 1st totaling 1 billion yuan (about 209.5 billion won). This is an expansion from before, and 100 hongbao worth 10,000 yuan (about 2.095 million won) each were also prepared as limited offers.
Hongbao refers to the custom in China of putting money in a red envelope (hongbao) to wish good fortune during holidays or celebrations. It has now taken hold as a way to send and receive cash via mobile messengers, and it is used by corporations as a powerful marketing tool to attract new users.
Ma Huateng, chair of Tencent, which operates WeChat (微信), the country's "national messenger," said, "We converted the marketing expense that competitors would spend on broadcasters into user hongbao," expressing a determination to recreate the glory of "WeChat hongbao," which drove WeChat Pay's success 11 years ago.
Baidu also distributed 500 million yuan (about 104.7 billion won) in hongbao to users of its AI product Wenxin (文心). The top amount is 10,000 yuan. It also secured the role of "chief AI partner" for the Lunar New Year gala broadcast Chunwan (春晚) to reinforce its brand. Another big tech giant, ByteDance Ltd., plans to integrate its AI assistant Doubao (豆包) throughout the broadcast as Chunwan's exclusive AI cloud partner.
Big tech companies are competing to hand out cash to draw more users and seize the lead in the AI services industry. According to data released by the China Internet Network Information Center (CNNIC), China had 515 million Generative AI users as of June last year, a penetration rate of 36.5%. In response, corporations are offering increasingly diversified AI services that go beyond simple chatbot functions and are competing to acquire more users.
Alibaba, China's largest platform company, is pursuing a "one-stop" service that handles everything from shopping to reservations with a single AI command. It connected all group services—shopping (such as Taobao), payments (Alipay), and maps (Gaode)—to its AI assistant Qianwen (千问), enabling AI not only to help through conversation but also to make reservations and payments directly in daily life. Alibaba has built its own "AI ecosystem" that tightly integrates AI with internet services.
Tencent has bet on "AI social." Within its AI service Yuanbao, it developed Pai (派), a group chat feature, to invite friends from its messenger apps WeChat and QQ and foster a culture of interacting together with AI. Specifically, it plans to offer features such as calling up AI to get answers to questions, photo retouching, watching movies, and listening to music. Beta testing will begin soon.
By contrast, ByteDance Ltd. is focusing on hardware. It has released an AI recorder and recently unveiled a phone loaded with the Doubao assistant, aiming to meet users starting at the smartphone operating system (OS) level.
China Business News analyzed that this shift is only the beginning. Citing ClawdBot, an AI agent that directly controls PCs, as an example, it noted, "The project received more than 30,000 'Stars' on the open-source platform GitHub within just a few days of its release." It added, "The Lunar New Year promotion battle in China and the global proliferation of AI services reflect the possibility that AI will tangibly change daily life in the new year."