WSJ: Top Western Companies Turn to Chinese AI, Undermining US Tech Dominance

By Staff, Agencies

A growing number of major Western firms are shifting toward Chinese artificial intelligence models, signaling a major challenge to US dominance—and potential profits—in the global AI race, The Wall Street Journal reported on Wednesday.

Corporate giants like HSBC, Standard Chartered and Saudi Aramco are already deploying or testing Chinese AI systems, including models from DeepSeek and Alibaba. Even US-based cloud providers such as Amazon Web Services, Microsoft and Google are offering access to DeepSeek’s technology, despite alleged security concerns raised by the White House.

The WSJ noted that China’s AI models are becoming increasingly attractive thanks to comparable performance at significantly lower cost. DeepSeek, for instance, has already racked up 125 million global downloads, according to data from Sensor Tower—though still trailing behind ChatGPT’s 910 million.

China’s edge doesn’t stop at affordability. Many of its models are open-sourced, giving users greater customization options and the ability to run systems offline—an appealing feature for institutions concerned about privacy and sovereignty.

The University of the Witwatersrand in South Africa selected DeepSeek for its research projects specifically because of its offline and open-source flexibility.

Likewise, Japan’s Ministry of Economy opted for Alibaba’s Qwen model over US counterparts. Globally, platforms like Latenode report that one in five users now prefers DeepSeek for building AI tools.

This accelerating adoption is starting to erode US influence in defining global AI standards. Microsoft President Brad Smith acknowledged during a US Senate hearing that the outcome of the AI race could hinge on whose technology achieves wider international adoption.

“The No. 1 factor that will define whether the US or China wins this race is whose technology is most broadly adopted in the rest of the world,” he warned.

However, the rise of Chinese AI isn’t without controversy. While the open-source versions are generally unrestricted, critics claim that consumer-facing applications often reflect the political values of the Chinese government.

This, they argue, could allow Beijing to quietly embed its digital norms as Chinese AI systems gain traction across borders.

US lawmakers are alarmed. In response, Congress is reportedly considering legislation that would prohibit federal agencies from using Chinese-developed AI—another reflection of rising techno-nationalism in Washington.

At the same time, US firms are scrambling to keep up. Meta has launched a new division to develop “superintelligent” AI, while President Donald Trump has thrown his support behind a massive $500 billion federal investment plan to secure American leadership in AI innovation.

OpenAI CEO Sam Altman also sounded the alarm, warning that Chinese companies like Zhipu AI are aggressively targeting emerging markets. “We want to make sure democratic AI wins over authoritarian AI,” said Altman, whose firm recently inked a $200 million deal with the Pentagon.

As the AI battleground spreads from tech labs to the geopolitical arena, The Wall Street Journal’s report highlights a growing global recalibration—one in which Chinese AI, not US-made tools, may increasingly set the pace for the future of intelligence.