DeepSeek’s V4-Flash model matches Google’s Gemini 3.6 Flash at a fraction of the cost, intensifying China’s AI price war.
Alibaba Cloud’s DeepSeek V4-Flash model completed benchmark tests for $0.03 each, matching Google’s Gemini 3.6 Flash in performance. The cost reflects a 78% reduction from Google’s pricing, targeting routine enterprise workloads.
DeepSeek’s pricing undercuts competitors like OpenAI and Anthropic, which score higher on intelligence benchmarks but charge significantly more. Alibaba Cloud’s AI Gateway already integrates DeepSeek’s APIs, while its Qwen3.8-Max model, unveiled the same day, boosted Hong Kong shares by 7%.
Alibaba’s cloud revenue surged 38% in the March quarter, with AI products accounting for 30% of external sales. However, aggressive AI spending has constrained group revenue growth, which rose just 3% despite plans to exceed a RMB380 billion three-year AI investment.