The company announced via a WeChat post on Thursday that the chatbot, which is inspired by OpenAI’s ChatGPT, will be available at no cost to all individual users starting in April. Following this announcement, Baidu's stock surged in Hong Kong, experiencing an increase of over 12%, marking its largest intraday rise since October.
This initiative by Baidu is likely to escalate the ongoing pricing competition among major domestic players, including Alibaba Group Holding Ltd. (BABA, 9988.HK) and ByteDance Ltd., which has intensified since the acceleration of AI development in 2023. Although Baidu’s Ernie was one of the first generative AI platforms to receive approval for public use from Beijing, competitors like ByteDance’s Doubao have since attracted a growing user base.
In 2025, DeepSeek disrupted the AI landscape with a model developed at a significantly lower cost compared to both US and Chinese competitors, leading to its increasing adoption by local agencies.
Additionally, Alibaba has garnered attention from investors and users with its improved Qwen model, which has shown strong performance against competitors such as Meta Platforms Inc.’s (META) Llama and DeepSeek’s V3 model in various evaluations.