Chinese AI models undercut US rivals, pressuring OpenAI and Anthropic

China's rapid AI model releases are closing the gap with US leaders, creating a "death zone" for companies lacking frontier technology or competitive pricing. Alibaba's Qwen3.8-Max matched or exceeded Anthropic's Fable 5. Moonshot's Kimi K3 matched costlier U.S. models on a small budget; DeepSeek's V4 Flash performed the same task for $0.03 versus $3.15. It raised fresh questions about U.S. chip sanctions. Chinese firms prioritize market share over profit, fueling price wars. ByteDance's video tool Seedance leads globally with steep discounts, while Washington weighs sanctions and AI safety controls.