Kai-Fu Lee, renowned AI expert and founder of 01.AI, believes China’s AI landscape is headed for a major shakeup—with only three major players likely to survive: ByteDance, Alibaba, and rising star DeepSeek. Lee has shifted his own company’s focus from building massive trillion-parameter models to partnering with AI platforms like DeepSeek to create practical, industry-specific solutions. He highlights DeepSeek’s ultra-low operating costs—just 2% of OpenAI’s $7B budget—as a game-changer. As China doubles down on AI innovation, Lee says the real opportunity now lies in smart applications, infrastructure, and cost-effective solutions—not in chasing the biggest models.

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