China’s AI firms scaled up on open-source models. The next phase may be different 17.04.2026

Chinese AI firms, including Alibaba Group Holding, have extensively utilized open-source models to rapidly scale their operations, with Alibaba's Qwen model alone accumulating nearly 1 billion cumulative downloads globally. This strategy, championed by Alibaba Chairman Joe Tsai, aims to democratize AI by lowering costs, particularly benefiting talent- and cash-constrained nations. However, the profitability of this generous approach remains a significant challenge, as indicated by Tsai's acknowledgment that the company does not directly profit from its AI models. Instead, Alibaba monetizes inference and cloud services, integrating open-source AI into its corporate identity. This recurring monetization question has become increasingly pertinent, especially following the emergence of models like DeepSeek and the success of startups MiniMax and Zhipu AI.















