Chinese AI invasion gives enterprises a new way to control cost

You can run a Chinese AI model on a laptop. The models are powerful, capable, in high demand, and help address a business problem: spending on AI tokens.

That is changing the economics of AI services and creating competitive problems for frontier models.

In its IPO prospectus released on Monday, Anthropic said that as a broad variety of models becomes available, "customers may conclude that incremental performance gains at the frontier do not justify the additional cost."

Chinese AI models accounted for more than half the reported token volume on OpenRouter, in its global count, in the week ending on Oct. 25. About a year earlier, only one Chinese model appeared among the nine named on the site’s weekly usage chart. OpenRouter provides access to multiple AI models through a single API.

For its own internal use, open source enterprise software provider Red Hat is piloting a self-hosted version of GLM, an open-weight model from Z.ai in Beijing. Chinese tech giant Alibaba’s popular Qwen model is also available at a smaller scale.

Engineers were initially nervous about whether open-weight models would be as capable as proprietary frontier models, said Stephen Watt, distinguished engineer and vice president of the office of the CTO at Red Hat. But they discovered that they were “good enough,” he said.

Watt said open-weight models, primarily from China, had reached a level of efficacy comparable to Anthropic’s Opus 4.6 in certain use cases. He said engineers had concerns about moving away from frontier models, but Red Hat’s usage data suggested open-weight models were adequate for many tasks.

“You’d be crazy not to start on a frontier model on your AI journey, but after a while, you’d be crazy to stay on it because it just eats all your margin," Watt said, referring to the comparatively high cost of most closed models.

For now, DataCamp is moving from Anthropic to OpenAI, which Cornelissen said he sees as less costly. It has not moved its tutor to an open-weight model.