Chinese AI Models Erode US Market Share with Cheaper Prices
The US AI market is facing competition from Chinese models, which are taking market share and offering significantly cheaper prices. According to Coinbase, the company cut its AI spending nearly in half while token use kept rising, thanks to cheaper defaults such as Z.ai's GLM-5.2 and Moonshot AI's Kimi K2.7 Code.
The pricing gap between US and Chinese models is significant, with OpenRouter listing Claude Opus 4.8 at $1.75 per million tokens for input and $25 per million tokens for output. In contrast, Vercel's AI Gateway lists GLM-5.2 at $1.40 per million input tokens and $4.40 per million output tokens.
Vercel's head of agentic infrastructure, Harpreet Arora, said that the daily token volume for GLM-5.2 grew about 27 times in its first full week on Vercel, while the number of customers using it rose about 80 times. He bluntly stated that 'Price is doing the work here.'
The success of Chinese models has not gone unnoticed by US companies, with Vercel CEO Guillermo Rauch saying he was 'genuinely impressed' by GLM-5.2's coding ability and adding 'This changes things.'