Chinese Tech Giants Build Their Own AI Models, Shunning Costly Western Licensing

Chinese technology companies are rapidly building proprietary foundation models rather than licensing Western alternatives, fueling an increasingly costly AI arms race where fierce competition, model distillation, and open-source strategies are eroding any single player's ability to dominate. The shift reflects both economic pressure—Chinese models cost roughly one-fifth the price of equivalent Western frontier models—and competitive necessity in a market where AI capability has become central to corporate strategy.