DeepSeek and Meituan: China's Most Ambitious AI Contenders on the Rise

In the intensifying competition of the global artificial intelligence market, DeepSeek and Meituan (OTC:MPNGY) are emerging as China's top contenders, challenging OpenAI, Microsoft (NASDAQ:MSFT), Alibaba (NYSE:BABA), and Tencent (OTC:TCEHY). While both companies pursue different strategies, their approaches reflect China's urgent need to secure leadership in next-generation AI technology.

DeepSeek's Agent-Centric Approach

According to a Bloomberg report on Thursday, Hangzhou-based DeepSeek is focusing on new agent-centric AI models designed to execute multi-step tasks with minimal user input, maintain learning from past behaviors, and function with greater autonomy than existing chatbots. Founder Liang Wenfeng, building on the success of their R1 model released in January this year, is targeting commercialization in the fourth quarter.

The R1 model garnered attention for offering performance comparable to OpenAI at a significantly lower cost, causing established industry players to become nervous. Although the pace of updates has slowed since this breakthrough, DeepSeek's focus on 'agentic' AI demonstrates its ambition to maintain leadership in the field as American competitors like OpenAI, Anthropic, and Microsoft accelerate the release of their own agent-based software.

Meituan's Open Source Strategy

Beijing-based Meituan, a leading food delivery company in China, has chosen an open-source strategy. According to the South China Morning Post (SCMP), the company recently unveiled 'LongCat-Flash-Chat', a large language model with 560 billion parameters based on a Mixture-of-Experts (MoE) architecture.

Initial benchmark results show that this system offers faster inference speeds and lower costs, positioning it to directly compete with Alibaba Cloud's Qwen, which currently supports the world's largest open-source AI ecosystem.

Two Approaches, One Goal

These two approaches—DeepSeek's agent-driven development and Meituan's open-source expansion—demonstrate that Chinese companies are intensifying competition not only with global rivals but also with domestic leaders. Both companies are entering fields that could define the next frontier of AI adoption.

Investment Perspective

For investors, Alibaba remains a key player in this competition. Buoyed by accelerated growth in its cloud division and positive prospects for its self-developed AI chips, Alibaba's stock has risen more than 54% this year.

Benchmark analyst Fawne Jiang emphasized that Alibaba's cloud revenue grew 26% year-over-year, noting that despite margin pressures from Quick Commerce, Alibaba is strengthening its foundations in cloud and e-commerce. He highlighted that Alibaba is well-positioned as China's leading generative AI and cloud provider, with potential for long-term market share growth.

Market Performance

Meanwhile, Microsoft's stock has risen 21% since the beginning of the year. This upward trend stems from its exclusive OpenAI contract and $80 billion in AI investments, driving rapid growth in cloud and AI sectors. Analysts praised strong fourth-quarter performance, with Wedbush describing the cloud and AI momentum as "stunning," Cantor mentioning very high Azure demand, and Bank of America Securities selecting it as a top pick due to broad strengths.