TMTPost -- iFlytek Co., Ltd., a leading Chinese voice technology solution provider, jumps on the bandwagon as price competition of artificial intelligence (AI) model intensified by major domestic players.

Credit：iFlytek

iFlytek announced on Wednesday that Spark Lite, a variant of its Spark AI model, would be free for the public to use for ever, and two versions--Spark Pro/Max would cost as low as RMB0.21 ( less than US$0.03) per 10,000 tokens, or units of data processed by the large language model (LLM) . The latest pricing is more than five times cheaper than Alibaba Group’s Tongyi Qwen-Max and Baidu, Inc.’s Ernie-4.0, both of which charged RMB1.20 per 10,000 tokens.

In AI sector, token is a fundamental unit of data that is processed by algorithms ,which makes 1,000 tokens equivalent to about 750 English words. As one token is equivalent to 1.5 Chinese characters in Spark, 10 tokens for the price of RMB2.10 (US$0.29) is enough for Spark Max to generate all of Yu Hua's popular novel "To Live", iFlytek said.

Established automaker China FAW Group Corp., Ltd the same day unveiled it has inked a strategic cooperation framework with iFlytek and Chinese electric vehicle (EV) maker Nio Inc. Under the framework, FAW and iFlytek will leverage respective technological advantages, experiences in their industries and markets, and carry out concrete cooperation around infrastructure represented by the intelligent computing center, algorithms and tools, intelligent platforms (including large models, big data, knowledge bases), and intelligent solutions for multiple scenarios for the businesses and the auto industry.

Less than a month ago, iFlytek updated Spark V3.5, the first large-scale model trained on a domestic computing platform. The iteration is iFlytek’s first large model capable of long text and long video generation. It outperforms GPT-4 Turbo on question-answering tasks in vertical field, and matches 97% of GPT Turbo’s ability in long text generation showcased last month, said iFlytek Chairman Liu Qingfeng. The anticipated release of iFlytek Spark V4.0 in June promises further advancements in AI capabilities.

The announcement of new pricing came as three Chinese tech giants heated up the price war of AI model. TikTok’s owner ByteDance launched a batch of large language models (LLMs) last week. The Doubao Pro LLM costs as low as RMB0.0008 yuan per 1,000-token prompt. Use of Doubao LLMs, which launched on May 15 via Volcano Engine, costs 99.8 per cent less than ChatGPT creator OpenAI’s GPT-4 model, which is priced at RMB0.42 per 1,000-token, according to Tan Dai, president of ByteDance’s cloud computing services unit Volcano Engine.

Alibaba followed suit on Tuesday. It cut price for flagship model Tongyi Qwen-Long by 97% to RMB0.02 per 1,000 tokens. The GPT-4 rival model, which supports upt to 10 million tokens of long text input, is 400 times cheaper than GPT-4. Baidu Cloud responded by offering free services utilizing its Ernie AI models: Ernie Speed and Ernie Lite from the same day.

These competitive moves mark the start of a price-driven battle within the AI sector, which is seeing substantial investment from startups and tech giants like Tencent. The influx of investment has led to the development of numerous AI models and an array of consumer and enterprise products, all vying for a large user base to accelerate AI advancements.

Chinese tech companies have a history of using steep discounts to dominate markets, from e-commerce to food delivery and ride-hailing. In March, Alibaba initiated a wave of price cuts in cloud computing, offering discounts of up to 55% on over 100 domestic services, which was quickly matched by competitor JD.com.