Baidu Shifts AI Strategy: ERNIE Bot Goes Free, Open-Source Model Announced

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On Wed, 12 Feb, 4:02 PM UTC

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Baidu, China's search engine giant, announces plans to make its ERNIE Bot free and open-source its ERNIE AI model, marking a significant shift in strategy amidst growing competition in the AI sector.

Baidu's Strategic Shift in AI

Baidu, China's leading search engine company, has announced a major shift in its artificial intelligence strategy. The company plans to make its ERNIE Bot chatbot service free starting April 1, 2025, and open-source its ERNIE AI model series on June 30, 2025 12. This move marks a significant departure from Baidu's previous closed-source approach and is seen as a response to increasing competition in the Chinese AI market.

ERNIE Bot and Model Series

ERNIE Bot, Baidu's ChatGPT-like service, is powered by the company's large language model (LLM) series. The current version, ERNIE 4.0, is claimed to match the capabilities of OpenAI's GPT-4 3. Baidu plans to gradually launch the ERNIE 4.5 series in the coming months before open-sourcing it 2. The company is also developing ERNIE 5, a next-generation model slated for release in the second half of 2025 15.

Market Position and Competition

Despite being an early investor in AI technology following ChatGPT's debut, Baidu has struggled to gain widespread adoption for its ERNIE model. Recent data shows ERNIE Bot lagging behind competitors:

  • ByteDance's Doubao: 78.6 million active monthly users
  • DeepSeek: 33.7 million active monthly users
  • ERNIE Bot: 13 million active monthly users 24

The emergence of DeepSeek, a startup offering open-source AI services comparable to OpenAI's advanced systems but at lower operational costs, has disrupted the sector and influenced Baidu's strategy shift 13.

CEO's Changing Perspective

Baidu CEO Robin Li, who previously advocated for closed-source models, has changed his stance on open-source development. At a recent event in Dubai, Li stated, "If you open things up, a lot of people will be curious enough to try it. This will help spread the technology much faster" 2. This change in perspective aligns with the company's new direction towards open-source AI.

Implications for the AI Industry

Baidu's decision to make ERNIE Bot free and open-source its AI model could potentially escalate a pricing war among major domestic players in China's AI sector, including Alibaba Group Holding Ltd. and ByteDance Ltd. 4. This move is expected to accelerate innovation and adoption of AI technologies in the region.

The shift also reflects a broader trend in the AI industry, with companies reassessing their strategies in light of the success of open-source models. Even OpenAI's CEO, Sam Altman, has hinted at the need to "figure out a different open-source strategy" 1.

Financial Impact

Following the announcement, Baidu's stock rose by as much as 7.9% in Hong Kong, marking its largest intraday gain since October 5. This positive market reaction suggests investor confidence in the company's new strategy and its potential to regain traction in the competitive AI landscape.

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