Baidu, OpenAI Offer Free AI Chatbot Services Amid Deepening Competition
Chinese tech giant Baidu has announced that it will make its Ernie Bot AI chatbot completely free for users, intensifying the race among global AI developers. The move comes in response to rising competition, particularly from emerging startup DeepSeek, which has gained attention with its cost-efficient, high-performance AI models.
In a statement posted on WeChat, Baidu revealed that both mobile and desktop users would gain access to premium Ernie Bot features, including AI-powered image generation, at no cost starting April 1.
The announcement closely followed a similar move by OpenAI CEO Sam Altman, who unveiled a roadmap for GPT-5 on X. Altman confirmed that ChatGPT users would soon have unlimited access to GPT-5 for free, while paid subscribers would receive enhanced AI capabilities.
Baidu later disclosed plans to roll out its next-generation AI model by June, marking a significant shift by making the model open-source – a first for the company and a step in line with DeepSeek’s approach. Additionally, Ernie’s Deep Search function, designed for advanced reasoning and expert-level responses, will be available free of charge from April.
Competitive Pressure in China’s AI Landscape
The move underscores the growing pressure on Baidu in China’s AI sector, particularly following DeepSeek’s latest release. The startup’s R1 AI model has drawn global attention for delivering performance on par with major US models at a significantly lower cost.
Following Baidu’s announcement, its Hong Kong-listed shares surged 12% on Thursday, boosting its market value. The stock last traded at 95 Hong Kong dollars ($12.20) per share on Friday, contributing to the 20% rise in the Hang Seng China Enterprises Index since January.
The Evolving AI Race
Since the global success of ChatGPT in late 2022, Chinese tech companies have scrambled to develop homegrown alternatives. Baidu was among the early contenders, launching Ernie Bot just four months after OpenAI’s chatbot. However, it has struggled to maintain dominance against rivals like ByteDance’s Doubao, which has amassed a larger user base.
Baidu also faces rising competition from newer players like Moonshot AI, which launched its chatbot Kimi last year. In January 2025, Kimi ranked as China’s third most-visited AI chatbot behind DeepSeek and Doubao, according to AI tracking platform aircpb.com.
Other challengers include Zhipu AI, a Beijing-based company backed by Tencent and Alibaba. However, Zhipu recently faced restrictions after the U.S. Commerce Department added it to its “Entity List”, citing alleged military ties – claims the company has denied.
A Shift Towards Free AI Services
Baidu’s decision follows a broader industry trend, as major AI firms increasingly offer basic chatbot services for free to attract users. OpenAI initially launched ChatGPT without charges before introducing premium subscription features. Baidu similarly monetized Ernie Bot in 2023, charging up to 59.9 yuan ($8.2) per month for advanced AI functions. Despite these paid features, the chatbot had 430 million users as of November 2024.
As competition heats up, tech giants are now redefining their strategies, making AI services more accessible while vying for dominance in the rapidly evolving AI market.
