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China’s Baidu Releases AI Model ERNIE 4.5 With DeepSeek-Level Performance At Half The Price

China’s Baidu Releases AI Model ERNIE 4.5 With DeepSeek-Level Performance At Half The Price

  • 16.03.2025 18:00
  • officechai.com
  • Keywords: AI

Baidu launched ERNIE 4.5 and X1 AI models, matching DeepSeek's performance at half the price. Available on its cloud platform, these advanced models highlight China's growing AI competition.

Alphabet NewsBIDUsentiment_satisfied

Estimated market influence

Baidu

Baidu

Positivesentiment_satisfied
Analyst rating: Buy

Baidu released ERNIE 4.5 and X1 AI models which are competitive with DeepSeek's performance at a lower cost.

DeepSeek

Negativesentiment_dissatisfied
Analyst rating: N/A

ERNIE 4.5 and X1 provide similar performance to DeepSeek R1 but at half the price, potentially impacting DeepSeek's market position.

Context

Business Insights and Market Implications

  • Release of ERNIE 4.5: Baidu introduced ERNIE 4.5, a new foundation model with multimodal capabilities, positioning it as a cost-effective alternative to DeepSeek R1, offering similar performance at half the price.

  • Performance Benchmarking:

    • ERNIE 4.5 demonstrated strong performance comparable to OpenAI’s GPT-4o and GPT-4.5 across most benchmarks.
    • Showcased improvements in understanding, generation, reasoning, memory, hallucination prevention, logical reasoning, and coding abilities.

  • Pricing Strategy:

    • ERNIE 4.5 pricing: $0.55 per 1M tokens (input) and $2.2 per 1M tokens (output).
    • ERNIE X1 pricing: $0.28 per 1M tokens (input) and $1.1 per 1M tokens (output).

  • Market Access:

    • ERNIE 4.5 available via APIs on Baidu AI Cloud’s MaaS platform, Qianfan.
    • ERNIE X1 set to launch on the same platform soon.

  • Competitive Landscape:

    • Reflects China’s growing AI ecosystem with multiple companies (e.g., DeepSeek) competing to develop advanced models.
    • Intensified competition in China’s AI sector, potentially driving innovation and cost reductions.

  • Strategic Considerations:

    • Baidu’s move highlights a focus on affordability and performance to capture market share.
    • Likely to accelerate advancements in Chinese AI technology, challenging global leaders like OpenAI.

  • Market Implications:

    • Cheaper models may lower barriers for enterprise adoption of AI technologies.
    • Could shift global AI dynamics, with China emerging as a key player in model development and deployment.

  • Long-Term Effects:

    • May lead to faster innovation cycles in AI, benefiting various industries.
    • Potential regulatory scrutiny due to competitive pricing and market dominance concerns.