China Is Quickly Eroding America's Lead in Global Artificial Intelligence Race

Chinese AI models are becoming more popular worldwide, testing American superiority

- Liza Lin, Raffaele Huang & Josh Chin

Chinese artificial intelligence companies are loosening the U.S.'s global stranglehold on AI, challenging American superiority and setting the stage for a global arms race in the technology.

In Europe, the Middle East, Africa and Asia, users ranging from multinational banks to public universities are turning to large language models from Chinese companies such as startup DeepSeek and e-commerce giant Alibaba as alternatives to American offerings such as ChatGPT.

HSBC and Standard Chartered have begun testing DeepSeek's models internally, according to people familiar with the matter. Saudi Aramco, the world's largest oil company, recently installed DeepSeek in its main data center.

Even major American cloud service providers such as Amazon Web Services, Microsoft and Google offer DeepSeek to customers, despite the White House banning use of the company's app on some government devices over data-security concerns.

OpenAI's ChatGPT remains the world's predominant AI consumer chatbot, with 910 million global downloads compared with DeepSeek's 125 million, figures from researcher Sensor Tower show. American AI is widely seen as the industry's gold standard, thanks to advantages in computing semiconductors, cutting-edge research and access to financial capital.

But as in many other industries, Chinese companies have started to snatch customers by offering performance that is nearly as good at vastly lower prices. A study of global competitiveness in critical technologies released in early June by researchers at Harvard University found China has advantages in two key building blocks of AI, data and human capital, that are helping it keep pace.

The competition, some industry insiders say, has set the world on the path toward a technological Cold War in which countries will have to decide to align with either American or Chinese AI systems.