> China is giving them for free despite not making financial sense because they want to weaken US's tech firms ability to compete - because China sees AI dominance as critical for their national security.

Nobody is making this argument because this is a normal thing that companies do. It's so common it is named in business strategy: "commoditize your complements."

There's a 2002 Joel On Software post explaining this using tech examples that were already old in 2002[1].

In the present, Meta is doing exactly the same thing with Ollama as Alibaba (who is funding some of the Chinese labs). Alibaba needs advanced models internally, and does not want to have a dependence on US models that can be arbitrarily shut off by Washington. Alibaba also wants to drive usage of its cloud among companies who are now demanding competitive AI models (which Alibaba may be locked out of providing). However, selling AI is not its core business. Putting cheap AI in the world creates demand for cloud services, which is part of Alibaba's core business.

Not only does this make financial sense for Alibaba, it is fairly basic.

Google gives away consumer software like Chrome and Android (not their core business) to drive search, which is their core business.

et cetera. The frontier labs are exposed in exactly the same has been way every pure play tech company before them. The US labs chose quality as their moat; remains to be seen whether that was a good choice, or if they can add another moat in time.

1 - https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/

> The US also sees AI dominance as critical for their national security, and relies on a market economy and non-state-owned labs.

[...]

> but the fact the discussion here ignores the fact that these concerns and dynamics are real just lower the discussion level instead of actually discussing potential solutions.

We had this problem solved for DECADES. Build the best post-secondary education system in the world. Lure all of China's (and the rest of the world's) best and brightest. Educate them. Give them well deserved, high paying jobs doing what they love and invite them to build a life and stay here.

Now we appear to be busy dismantling that system.

I think the misconception here is that they "give them away".

Sure, you can download the weights and run it yourself, but to run a 1T+ parameters you need roughly 2TB of VRAM (for full precision). That costs around $500k to $1M, not including electricity and rent.

In reality, they provide their models priced via API or subscription just like any other company. The "free weights" are only useful for other research labs. It seems that China understands that research should be shared and open, which is one of the reason that AI has been able to develop that fast in the last 10 years.

> costs hundreds of billions to develop - to BOTH US and China

OpenAI and Anthropic are extremely bloated compared to the Chinese labs. They have thousands of extremely well paid people working for them. Deepseek I think has a couple of hundred and I doubt they are paid a lot.

Of course compute for training is expensive but I doubt that’s necessarily the overwhelming majority of the operating costs for Anthropic/OpenAI

> on a market economy and non-state-owned labs

Sure the private companies developing these models are heavily interlinked with and even maybe partially owned by the government. But its a matter of degree. Since that’s the situation in the US similar in how these companies both shape government policy directly and in how the government is constantly intervening and shaping their behavior outside of any regulatory framework.

The US government is both heavily protectionist and interventionist these days.

> next guy

Good try GPT-5…

The software landscape is full of free products that are used to upsell other services. In this case the upsell is inference at data centers. China has built a big advantage in Green energy and is working at the GPU issue both on the hardware and model level. Those are the two main cost inputs into AI and should allow China to compete. The exact model being used is not going to matter as much as the cost that companies must pay.

> "predatory pricing" (economic term for a competitor selling at a loss to eliminate you), which is illegal in the US

It is very funny that this was/is the playbook of a huge number of successful, VC-funded, "disruption" plays.

Cheap cabs that undercut the market, wait for taxi companies to die, raise your rates now that your "rideshare" app got everyone hooked on the subsidized rate, IPO!

> This means that these frontier labs are truly susceptible to "predatory pricing" (economic term for a competitor selling at a loss to eliminate you)

OpenAI and Anthropic were losing money too until recently, when they started focusing more on increasing revenue (which is also part of why companies are now looking more at Chinese models to reduce costs).

That's nonsense, people pretend that a "frontier model" is the most important technology ever, but we know for sure it cannot be because several companies are doing copycats of one another. It is not China that is doing much effort to copy-cat, it's the US companies that are copying one another. The only real barrier in this technology is how many Nvidia chips you can buy and how much data you can get to train your LLM. All these models are basically moving in the same trajectory, it is essentially a very expensive copy-paste job they're doing.