China AI companies unveil new models and launch massive promos in a Lunar New Year AI battle.
Chinese technology firms are rushing to unveil new artificial intelligence tools ahead of the Lunar New Year, sparking what industry watchers now call the “Lunar New Year AI War.”
The race is not only about innovation. It is also about attracting millions of new users in one of the world’s most competitive AI markets.
Alibaba Group, ByteDance and Kuaishou have all rolled out major updates in recent days. Start-ups such as Zhipu AI are also stepping forward with new models aimed at challenging the established giants.
The surge of releases comes one year after DeepSeek disrupted the global market with a low-cost AI model that forced competitors to rethink pricing and performance.
Alibaba’s research arm, DAMO Academy, introduced RynnBrain an open-source embodied AI model built for robotics.
The company says the system improves spatial and time-based awareness, helping robots remember object locations and predict movements.
According to Alibaba, RynnBrain achieved top results across 16 open-source robotics benchmarks, surpassing competing systems from global rivals including Google and Nvidia.
ByteDance launched Seedance 2.0, a video-generation model that quickly attracted attention online. A hyperrealistic clip showing actors resembling Tom Cruise and Brad Pitt in a fight scene went viral, prompting Tesla CEO Elon Musk to comment on X, writing: “It’s happening fast.”
However, the Motion Picture Association accused ByteDance of large-scale unauthorized use of US copyrighted content.
Meanwhile, Kuaishou upgraded its Kling AI platform to version 3.0. The new version supports videos up to 15 seconds long, includes built-in multilingual audio generation and introduces an “AI Director” feature for automatic scene control.
Since launching in June 2024, Kling AI has served more than 60 million creators globally. The company says it reached $240 million in annual recurring revenue as of December 2025.
Beyond product launches, the competition has shifted to aggressive marketing.
Alibaba is investing 3 billion yuan (about $430 million) to promote its Qwen AI app during the holiday season, according to Reuters.
Baidu has committed 500 million yuan to its Ernie app, while Tencent has reportedly doubled that amount to 1 billion yuan for Yuanbao.
The promotional push has stretched systems to the limit. Alibaba disclosed that Qwen processed more than 120 million orders in six days.
The heavy traffic caused repeated service disruptions, with the chatbot posting on Weibo that it was overloaded and asking users to “give the chatbot a break.”
Zhipu AI also entered the spotlight with the release of GLM-5, a 744-billion-parameter model. The company claims it outperforms Google DeepMind’s Gemini 3 Pro in coding and agent-related tasks, though it still trails Anthropic’s Claude in overall performance.
Following the announcement, Zhipu’s Hong Kong-listed shares jumped 28.7 percent, reflecting strong investor interest.
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