III. Industry Restructuring & Competitive Dynamics
1. The U.S.-China Bipolar Rivalry
The report reveals a defining bipolar AI landscape dominated by the U.S. and China. China now rivals—and in some domains surpasses—the U.S. in critical metrics:
- Industrial robot installations: China commands 75% of global deployments.
- Large model releases: Chinese labs match U.S. output in cutting-edge AI systems.
Crucially, China’s ability to deliver near-state-of-the-art performance at radically lower costs challenges the high-valuation business models of players like OpenAI.
Market Expansion & Global Reach
- India emerges as ChatGPT’s largest user base (13.5% of global traffic), surpassing the U.S. (8.9%).
- India is also the top overseas market for China’s DeepSeek, accounting for 7% of its global users.
The Low-Cost Tech Offensive
Chinese models achieve stunning price-performance breakthroughs:
- Baidu ERNIE 4.5 Turbo operates at 40% the cost of DeepSeek V3 and just 0.2% of GPT-4.5’s expense.
- DeepSeek-R1 hits 93% accuracy on MATH Level 5 tests, nearing OpenAI o3-mini’s 95%.
Open-Source Dominance
China leads the open-source revolution:
- Alibaba has open-sourced 200+ models, with 300M+ downloads globally. Its Qwen ecosystem spawned >100,000 derivatives—the world’s largest open-model family.
- Zhipu AI’s GLM-4 attracted 6,000+ enterprises on launch day.
- As shown below, China now equals the U.S. in large-scale AI system releases (2017–2024).
The New “Space Race”
Meta CTO Andrew Bosworth’s warning resonates:
“AI leadership may determine geopolitical supremacy.”
This isn’t just technological competition—it’s a high-stakes reordering of global influence, with the U.S. and China as primary contenders.
2. Closed-Source vs. Open-Source: The Silent User Revolution
Closed Ecosystems Still Dominate… For Now
Despite open-source momentum, proprietary models retain user-scale dominance:
- OpenAI’s revenue surged (2022–2024) while compute costs fell—signaling a maturing commercialization path (ChatGPT Plus, API, enterprise subscriptions).
…But Open Source is Relentlessly Catching Up
Cost efficiency fuels the open-source rise:
- Models like DeepSeek, Meta’s Llama 3, and Alibaba’s Qwen now rival top closed models in reasoning and coding.
- By 2024, the U.S. released >100 LLMs trained on >10²³ FLOPs, with China entering a high-density launch phase to narrow the gap.
- Europe/Canada trail significantly (<20 major models combined).
China’s Industrial Automation Edge
A decisive lead in real-world deployment:
- 2023 industrial robot installations: China deployed 276,000 units—surpassing the rest of the world combined.
Users watch silently—benefiting from falling costs, rising quality, and unprecedented choice. The real winner? Innovation itself.