OpenAI Could Soon Discontinue Services in China With Blocking Measures Starting July 9

OpenAI has reportedly notified users in China that it will soon discontinue its services in the region. Additional blocking measures are set to take effect by July 9.

OpenAI's plans follow reports last month that the US, with national security in mind, is looking to bar certain nations from accessing America-based technologies such as artificial intelligence.

Chinese platform customers have received emails since late Monday alerting them that they are in an area that OpenAI does not support. The letters further state that starting on July 9, additional steps will be taken to prevent API traffic from entering unsupported zones.

Although ChatGPT is not accessible on China's mainland, many Chinese startups have reportedly been able to leverage OpenAI's API platform to create their apps. China's top AI developer, Baidu, responded by announcing establishing an "inclusive program" that would allow new users to migrate to its Ernie platform for free.

According to a statement from Baidu's cloud company, OpenAI users would receive extra tokens for the Ernie 3.5 flagship model commensurate with the amount of OpenAI they use. The text that AI models analyze is called a token.

Alibaba Cloud also contributed by using its AI platform to provide OpenAI API users with free tokens and migration services. Alibaba claims the company's Qwen-plus model is substantially less expensive than the GPT-4.

Projected US AI Ban on China

The announcement that OpenAI will no longer be operational in China comes just over a month after reports indicating that the US was planning to impose additional sanctions on China and Russia, including a ban on access to US-made artificial intelligence models and software like OpenAI.

Any action would be in addition to several other measures taken over the previous two years to stop China from receiving cutting-edge AI chips, which would hinder Beijing's development of this cutting-edge technology for military purposes. At the time, the Chinese Embassy stated that China vehemently disagreed with the action and would take the necessary precautions to safeguard its interests.

Nothing at the time stopped US AI giants like Anthropic, Google DeepMind, and Microsoft-backed OpenAI from developing some of the most powerful closed-source AI models and offering them for sale to almost everyone in the world without interference from the government.

China's AI Sector

The reported move by OpenAI also comes after sources indicate that China's AI industry is booming, with over 4,500 AI companies operating there as of now, according to official data disclosed by Shan Zhongde, Vice Minister of industry and Information Technology, at the 2024 World Intelligence Expo in Tianjin.

Due to China's rapid rise in the AI sector, AI businesses are in fierce competition with one another, especially when it comes to creating large language models (LLMs). According to reports, China already has more than 100 LLMs with over a billion parameters, matching some of the world's top models.