Alibaba announces huge investment in AI push as chatbot war heats up

The world's leading e-commerce platform, Alibaba, said on Monday, February 2, 2026, that it will spend 3 billion yuan ($431 million) to attract users to its Qwen AI app during ​the Lunar New Year holiday, heating up a race between China's largest ‌tech firms.

The pledge by the Chinese multinational technology conglomerate Alibaba, which triples the spending promised earlier by rivals Tencent and Baidu, is ‌set to start on February 6, 2026.

The group said in a statement that "it will involve incentives for dining, drinks, entertainment, and leisure, with 'large red envelopes distributed continuously.'"

Tencent and Baidu previously announced late last month they would spend 1 billion yuan and 500 million yuan, respectively, on ⁠similar promotions for their AI ‌chatbots.

Why is Lunar New Year important for investors or marketers?

Chinese tech companies have long used the Lunar New Year festive period—when hundreds of millions travel home and spend time with ‍family—as a marketing battleground to acquire new users.

The most notable case was in 2015, when Tencent leveraged its WeChat messaging app to distribute digital red envelopes, helping its WeChat Pay service ​gain ground against Alipay, which then dominated China's mobile payments market.

The public holiday ‌period this year begins on February 15, 2026, and is nine days long, longer than in most previous years.

AI race:

Competition in China's AI sector has accelerated since DeepSeek's R1 model launch in January last year rattled global AI markets, spurring both faster adoption and fiercer rivalry among domestic players.

Several other Chinese AI firms have also been releasing upgrades in ⁠the run-up to the holiday.

As per new reports, DeepSeek is expected to launch its next-generation AI model, V4, featuring strong ‌coding capabilities, in mid-February.