Alibaba Bets Big on AI with $431 Million Lunar New Year Push, Escalating Tech Rivalry
BEIJING, Feb 2 (Reuters) — In a bold move to capture the public's attention during the nation's most important holiday, Alibaba Group Holding Ltd. unveiled plans on Monday to deploy a 3 billion yuan ($431 million) war chest. The funds are earmarked for a promotional blitz around its Qwen artificial intelligence app, sharply escalating a marketing contest among China's technology titans.
The initiative, set to launch on February 6, dwarfs commitments from competitors Tencent Holdings and Baidu Inc., which last month pledged 1 billion yuan and 500 million yuan, respectively, for their own AI chatbot promotions. Alibaba stated the campaign will offer incentives tied to dining, entertainment, and leisure activities, promising "large red envelopes distributed continuously" to users.
This year's extended nine-day public holiday, beginning February 15, provides a critical window for user acquisition. Chinese tech firms have a well-established history of turning the Lunar New Year—a period of mass travel and family gatherings—into a digital marketing arena. The precedent was famously set in 2015 when Tencent used WeChat's digital red envelope feature to rapidly expand its mobile payment service, challenging Alipay's dominance.
The current spending surge underscores the strategic importance of the consumer AI space. Competition has intensified since the launch of DeepSeek's R1 model last January, which spurred both innovation and aggressive user outreach among domestic players. Tencent's campaign for its Yuanbao chatbot app, starting Sunday, requires app updates for users to claim digital red envelopes transferable to WeChat Pay. Alibaba has not detailed if its rewards will be direct cash or platform-specific coupons for services like Taobao.
Industry observers note the holiday push coincides with a wave of product upgrades. DeepSeek is reportedly preparing to debut its next-generation V4 model with enhanced coding capabilities in mid-February, signaling that the battle for AI supremacy will extend far beyond holiday marketing.
User Perspectives:
"As a small business owner, I'm intrigued," said Michael Chen, a café owner in Shanghai. "These promotions could drive more local spending. If the AI tools themselves become more useful for logistics or customer service, that's the real win."
"It feels like a desperate cash grab to buy market share," argued Lisa Wang, a tech analyst based in Shenzhen, her tone sharp. "These companies are throwing billions at gimmicks when fundamental questions about AI monetization and real-world utility remain unanswered. It's a spectacle, not a strategy."
"The scale is impressive," noted David Li, a university student. "My friends and I will definitely try to claim the rewards. It's an easy way to get introduced to these AI apps, even if we don't stick with them long-term."
"This is classic ecosystem warfare," commented Priya Sharma, a fintech consultant in Hong Kong. "They're not just selling an AI app; they're pulling users deeper into their respective digital ecosystems—payments, e-commerce, social media. The holiday is just the battlefield."
($1 = 6.9519 Chinese yuan renminbi)
(Reporting by Liam Mo and Brenda Goh; Editing by Stephen Coates)