Key Points
- Tencent and iFlytek have reduced Language Model prices. Tencent offers Hunyuan lite for free, and iFlytek makes Spark either free or five times cheaper.
- This price reduction followed similar moves by Alibaba and Baidu, who slashed their LLM prices earlier in the week, and Bytedance last week.
- Tencent and iFlytek launched ChatGPT-like products in September 2023 and claimed superior performance over OpenAI’s ChatGPT.
- The aggressive pricing reflects a competitive push among Chinese tech giants to dominate the generative AI market.
China’s leading internet company Tencent (0700.HK) and AI firm iFlytek (002230.SZ) have significantly reduced the prices of their large-language models (LLMs) used to power ChatGPT-like chatbots, marking the start of a price war among the country’s biggest tech giants. On Wednesday, Tencent’s cloud unit announced that the “lite” version of its LLM, Hunyuan, would now be free, while prices for more powerful versions have been slashed by between 50% and 88%.
iFlytek revealed that its “Spark” LLM would be either free or five times cheaper than comparable products from competitors. This move follows similar actions by other major Chinese tech companies. On Tuesday, Alibaba’s (9988.HK) cloud division and Baidu (9888.HK), a search engine conglomerate, reduced the prices of their LLMs. Bytedance also lowered its LLM prices last week.
Both Tencent and iFlytek launched their ChatGPT-like products in September 2023, entering a competitive race among Chinese tech firms to dominate the generative AI market, which a Tencent executive has dubbed “a war of hundred models.” At their launch, both companies claimed their LLMs outperformed U.S.-based OpenAI’s ChatGPT, which was introduced in late 2022.
Hefei-based iFlytek, renowned for its voice recognition technology, announced that its Spark Lite model would be free for public use, while Spark Pro/Max would cost only 0.21 yuan (less than 3 cents) per 10,000 tokens or units of data processed by the LLM. This new pricing is five times cheaper than the 1.2 yuan per 10,000 tokens charged by Baidu’s Ernie 4.0 and Alibaba’s Tongyi Qwen-Max.
Additionally, Tencent’s Hunyuan Pro is now priced between 0.2 and 0.9 yuan per 10,000 tokens. One token is equivalent to 1.5 Chinese characters in Spark, meaning that 2.1 yuan ($0.29) would be enough for Spark Max to generate the entire text of Yu Hua’s popular novel “To Live,” according to a statement published on iFlytek’s official WeChat account.
This aggressive pricing strategy highlights the intensifying competition among Chinese tech giants to capture a larger share of the generative AI market. By making their LLMs more accessible and affordable, these companies aim to attract more users and establish themselves as leaders in the rapidly evolving AI landscape.
