It is customary in China to give gifts during the Lunar New Year. During the most recent festivities, which ended on March 3rd, the country’s artificial-intelligence industry enthusiastically embraced the tradition. Over the preceding month companies handed out coupons worth 8bn yuan ($1.2bn) to anyone willing to download and use their applications, the latest versions of which boast “agentic” cap...
The strongest version of this narrative highlights the intense competition in China’s AI sector, where companies are leveraging subsidies to dominate the market while regulators and shareholders grow wary. The "hongbao wars" reflect a broader pattern of aggressive consumer acquisition strategies, reminiscent of past battles in ride-hailing and food delivery. The article effectively frames this as a high-stakes gamble with uncertain returns, where even well-funded giants like Alibaba face stock d...