ByteDance is making significant strides in the artificial intelligence (AI) sector through substantial investments and the rapid development of its AI chatbot, Doubao. The company has committed around 80 billion yuan (approximately US$11 billion) in capital expenditures this year alone, positioning itself as the leader in spending among China’s major technology firms. This investment is set to double to 160 billion yuan (US$22 billion) in 2025, reflecting ByteDance’s aggressive strategy to outpace its competitors.
In early June, ByteDance allocated 124 million yuan to advertising efforts for Doubao within the first ten days. This marketing push has contributed to Doubao’s explosive growth since its launch in May. By November, the chatbot had amassed nearly 60 million monthly active users (MAUs), making it the most-used AI chatbot in China, second only to OpenAI’s ChatGPT. According to rankings by Aicpb.com, Doubao’s performance now rivals that of GPT-4 in areas such as reasoning, coding, and following complex instructions.
ByteDance’s AI portfolio has expanded significantly, now encompassing around 20 products that include language model-powered chatbots, text-to-video and text-to-image tools, music generation applications, and video editing software. This diverse array of innovations has substantially enhanced ByteDance’s flagship platforms, Douyin and the news app Jinri Toutiao.
Zheshang Securities emphasizes that ByteDance’s aggressive investments in computing power are crucial for advancing China’s AI sector. The company is projected to spend an astonishing 90 billion yuan (US$12.5 billion) on computing power alone by 2025. This expenditure closely mirrors the combined investments of its primary competitors—Baidu, Alibaba, and Tencent—who together have contributed approximately US$13.8 billion to AI development.
Doubao not only excels in functionality but also offers a cost advantage over its rivals. With a usage cost of just 0.003 yuan (US$0.00041) per thousand tokens, Doubao is significantly cheaper than ChatGPT, which charges 0.0175 yuan per thousand tokens. This pricing strategy has likely contributed to Doubao’s rapid adoption and popularity among users.
ByteDance’s recent spending trajectory marks a stark increase from the mere 18 million yuan spent across April and May on AI development. As the company continues to innovate and expand its AI capabilities, it solidifies its position as a formidable player in the technology landscape.
Featured image courtesy of Roll Call
