Since the ChatGPT's stone-cold rise in December 2022, the big model has quickly become a popular project in China, and the track has become more and more popular, while the number of variables is increasing day by day.

Wang Huiwen, the co-founder of Meituan, who had to retire for personal health reasons, has not only resigned as a non-executive director of Meituan, but also found a good disposal plan for Lightyear, which he founded and lit a big fire in the direction of big model startups in China, under much attention - Meituan bought Lightyear for a total consideration of about 2.065 billion yuan. The company bought 100% of the shares of Lightyear for a total consideration of about 2.065 billion yuan, thus replacing Wang Huiwen as the manager of Lightyear.

In the past six months, after Baidu followed the footsteps of ChatGPT and took the lead in launching a large model of Wenxin Yiyin in China, the head of the big technology companies have made a lot of moves, Ali Tongyi thousand questions, Tencent mixed, Huawei Pangu, etc. are in this list. According to the "China Artificial Intelligence Big Model Map Research Report" released by the New Generation Artificial Intelligence Development Research Center of the Ministry of Science and Technology, as of May 28, 2023, 79 domestic big models above the scale of 1 billion parameters have been released.

Among the endless big models, the entry story of veteran AI company KDDI is also quite worth telling.

KU XUNFE released the Starfire cognitive big model on May 6, 2023, and released a new v1.5 version 1 month later. Liu Qingfeng, the founder and chairman of KU XUNFE, said that by the time of KU XUNFE Global Developer Conference on October 24, the Starfire Big Model should achieve Chinese beyond ChatGPT and English to ChatGPT level.

These initiatives and expressions gave a strong impetus to the rise of KDDI's share price. in June 2023, KDDI's share price reached its highest point of 82 yuan per share since its listing, corresponding to a total market capitalization of over 150 billion yuan. Keep in mind that in January 2023, KDDI's market capitalization was less than RMB 80 billion.

Naive Starfire's big model was released after the controversy.

One of the controversies came from a domestic agency called SuperCLUE. The agency's comprehensive benchmark list of Chinese general-purpose big model reviews released on May 9 ranked KDDI's Starfire big model fourth after Human, ChatGPT 4, and ChatGPT 3.5. The SuperCLUE is modeled after the GLUE and SuperGLUE, the authoritative data set for natural language processing, but is actually self-evaluated by domestic private organizations. According to public information, the SuperGLUE list is generally more than 20,000 questions, but the domestic SuperCLUE questions are only 100.

On the day the list was released, SuperCLUE's official website showed that the first Chinese benchmark assessment member advisor was Cui Yiming, a senior researcher at Harvard Xunfei Joint Laboratory. The next day, May 10, the website removed the relevant information. And in the June 2023 Chinese Big Model Ranking, the agency ranked humans at 0, the first and second positions were still ChatGPT, the third and fourth positions became 360 Smart Brain (4.0) and Wenxin Yiyin (v2.0.4), and Xunfei Starfire (v1.5) ranked to the sixth.

The conversation didn't end there.

On May 24, shares of KU Xunfei plummeted, once dropping more than 9% during the day. The official response from KU Xunfei said that the fall in share price was caused by a generative AI product writing a false mini-essay, and the mini-essay mentioned that KU Xunfei was exposed to a large amount of user privacy data and used it for artificial intelligence research as untrue information, the company's legal department will take legal measures if it is found to have malicious disinformation.

The discerning eye will know at a glance that this is pointing the finger at Baidu Wenxin Yiyin.

The person in charge of the market of Wenxin Yiyin Zhang full text on the same day published a circle of friends, said that friends to blame the stock price plunge on Wenxin Yiyin proposition small essay is bumper to bumper, for unwarranted malicious smear smear, Baidu side will also take legal measures, "come and go is not a gift".

According to the actual narrative or bumper sticker marketing, the domestic big model has just hit the road, it is difficult to say which is stronger or weaker, while the distance of the Starfire big model from the KDDI claim to catch up with ChatGPT is there for all to see. In the context of annual revenue growth slipping from 40.61% in 2021 to 2.77% in 2022, it remains to be seen what the big model can bring to the business direction of KDDI.

From Voice to AI

KDDI had a first-mover advantage in the field of intelligent voice in China.

The company, which was founded more than 23 years ago, has already exceeded 100 million yuan in sales in 2004, and its cooperation with Lenovo and Huawei has made it a giant in the field of voice interaction.

In May 2008, KDDI was listed on the Shenzhen Stock Exchange, and in the same year the company's revenue was 257 million yuan, up 25.14% year-on-year. The 257 million yuan was made up of three main businesses, which were voice support software with revenue of 54.58 million yuan, voice industry applications/systems with revenue of 76.31 million yuan, and information engineering and operation and maintenance services with revenue of 126 million yuan. It is particularly noteworthy that the information engineering and operation and maintenance services business, which accounted for 49.17% of the total revenue, was mainly supported by KDDI's corporate location in Anhui, which contributed 99.49% of KDDI's revenue from this business.

Around 2010, when smartphones were on the rise, Xunfei quickly seized the opportunity to launch Xunfei Voice Cloud, and in 2011, it launched its first entry-level voice synthesis chip, which also brought Xunfei Input Method to mobile Internet users. Today, Xunfei Input Method supports speech recognition of 23 dialects including Cantonese, Hakka, Minnan and 5 minority languages such as Tibetan.

In 2014, Xunfei launched the Xunfei Super Brain Program, shifting from NLP to AI. 2015 annual revenue of Xunfei was 2.5 billion yuan, of which the highest proportion was still information engineering and operation and maintenance services, with revenue of 720 million yuan (28.83%); followed by education application products, with revenue of 660 million yuan (26.4%); telecom voice value-added products, with revenue of 313 million yuan (12.52%); voice support software, revenue of 303 million yuan (12.12%); industry application products IFLYTEK-C3, revenue of 247 million yuan (9.91%); the rest accounted for a relatively small share of audio and video surveillance, communication data analysis applications, college education and teaching and other business revenue. In other words, what supports KDDI's revenue is mainly software and information technology services.

With the rapid development of the Internet, many large manufacturers have also cut into the field of voice interaction, which makes the position of KDDI less and less stable. Data from the China Voice Industry Alliance shows that in 2012, KDDI accounted for 54.3% of China's intelligent voice market, which dropped to 44.2% in 2015, with Baidu in second place at 27.8% and Apple in third at 6.9%. Baidu, NetEase and other large manufacturers have their own build-up, which is bound to have an impact on KDDI.

The outside world has also been quite skeptical of KDXF's AI products, such as its e.g. voice interpretation products.In 2018, someone published an article on the internet, arguing that KDXF products actually have a manual translation component when it comes to translation. In response, Xunfei responded that the product uses a "human-machine coupled translation assistant" model, in which the machine provides the results of voice recognition and machine translation to the simultaneous interpreter to assist the work of the interpreter. This is also an objective admission that "Xunfei Hear" is far from the level of simultaneous interpretation and cannot replace simultaneous interpreters with AI.

Despite the shortcomings, Xunfei's business has performed well, with an average revenue growth rate of over 25% for 10 consecutive years. But the more emerging technologies, the faster the iterations within the field, including voice interaction and AI. according to the "2023-2028 China Intelligent Voice Industry Market Development Status and Investment Direction Research Report" released by Huajing Industry Research Institute, China's intelligent voice market size grew from about 10 billion yuan in 2017 to $34.1 billion in 2022, and is expected to reach $38.2 billion in 2023; And those occupying a high domestic market share in 2022 are KDDI (44.2%), Baidu (37.8%), Apple (15.4%), Nuance (6.9%) and Little i Robot (3%).

The voice sector is under pressure, and broad AI is more difficult.

Research institute Ari Consulting "China Artificial Intelligence Industry Research Report" shows that the market size of China's AI industry has reached 154.6 billion yuan in 2020, 195.8 billion yuan in 2022, and is expected to reach 612.2 billion yuan in 2027, with a relevant CAGR of 25.6% from 2022-2027, i.e. compound annual growth rate.

The market is promising and the competition is fierce. In the whole AI industry map, including different fields such as computer vision, big data intelligence, conversational AI, content audit, intelligent driving, etc., the technical layer and specific application layer where KDDI is located need to face directly the attack of domestic Baidu, Ali, Tencent and foreign Google, Microsoft and other big manufacturers.

The financial report shows that KDDI's 2022 revenue was 18.82 billion yuan, an increase of only 2.77%; the first quarter of 2023 revenue was 2.887 billion yuan, a decline of 17.64%. KDDI officials attributed the first quarter performance issue to the special environment in December 2022 and January 202 and the subsequent Chinese New Year holiday, which was considered a short-term shock and did not affect long-term business fundamentals. The official also said that the inclusion in the list of U.S. entities in 2019 was followed by another pressure in October 2022; the fourth quarter of 2022 and the first quarter of 2023 are in the process of adjustment, which, together with the launch of the big model, is expected to result in positive revenue and gross profit growth from the second quarter onwards.

Model success geometry?

According to the financial report, for the full year of 2022, KDDI's main business remains software and information technology services, accounting for 98.41% of total revenue; the largest share of which is education products and services, accounting for 32.74% of total revenue; followed by open platform and consumer business (24.66%), followed by smart city (23.63%) and carrier-related business (11.14%); smart Automotive, Smart Healthcare and Smart Finance together accounted for 6.2%.

The rapid development of AI business requires KDDI to follow the technology trend, and the importance of large models cannot be overstated.

The importance of the big model can be seen by the investment in R&D. The financial report shows that KDDI invested 2.936 billion yuan in R&D in 2021 and grew to 3.355 billion yuan in 2022, up 14.28% year-on-year; the number of R&D staff has increased from 8,367 in 2021 to 9,281 in 2022, up 10.92% year-on-year, and the proportion of the overall staff has increased to 61.68%.

But in fact, excluding algorithms, the difficulty and focus of large model training is the need for huge data and huge computing power, including CPU (central processing unit), GPU (graphics processor), ASIC (special integrated chip) and other hardware devices, as well as software platforms and frameworks to support massively parallel computing, in addition to involving a large amount of data storage, transmission, and related human maintenance and upgrading. nvidia that is, nvidia NVIDIA research data shows that the largest scale model of ChatGPT 3 requires the use of 175 Billions of parameters and requires 512 V100 graphics cards for 7 months or 1024 A100 chips for up to one month, costing over a million dollars per month.

This means that the financial strength of the large factories have more burning money, the general enterprise is difficult to participate in the competition. 2022 year, Ali, Tencent's R & D investment are more than 50 billion yuan, while Baidu in the case of R & D investment of 21.4 billion yuan, its Wenxin a word is still a large gap with ChatGPT, not to mention the same period of R & D investment of only about 3 billion yuan of Keda Xunfei.

Even so, there are still many people who have high hopes for KU Xunfei. This is not only because it has some first-mover advantage in voice and AI, but also because the company carries more or less a national team color. The latest financial report, the first quarter of 2023, shows that state-owned legal person China Mobile Communications Co. and China University of Science and Technology Asset Management Co. are ranked first and fourth among the top 10 shareholders of KU Xunfei, with 10.66% and 3.59% shareholding respectively, while Liu Qingfeng, as founder and chairman, is ranked second with 7.24% shareholding.

Since the ChatGPT's stone-cold rise in December 2022, the big model has quickly become a popular project in China, and the track has become more and more popular, while the number of variables is increasing day by day.

Wang Huiwen, the co-founder of Meituan, who had to retire for personal health reasons, has not only resigned as a non-executive director of Meituan, but also found a good disposal plan for Lightyear, which he founded and lit a big fire in the direction of big model startups in China, under much attention - Meituan bought Lightyear for a total consideration of about 2.065 billion yuan. The company bought 100% of the shares of Lightyear for a total consideration of about 2.065 billion yuan, thus replacing Wang Huiwen as the manager of Lightyear.

In the past six months, after Baidu followed the footsteps of ChatGPT and took the lead in launching a large model of Wenxin Yiyin in China, the head of the big technology companies have made a lot of moves, Ali Tongyi thousand questions, Tencent mixed, Huawei Pangu, etc. are in this list. According to the "China Artificial Intelligence Big Model Map Research Report" released by the New Generation Artificial Intelligence Development Research Center of the Ministry of Science and Technology, as of May 28, 2023, 79 domestic big models above the scale of 1 billion parameters have been released.

Among the endless big models, the entry story of veteran AI company KDDI is also quite worth telling.

KU XUNFE released the Starfire cognitive big model on May 6, 2023, and released a new v1.5 version 1 month later. Liu Qingfeng, the founder and chairman of KU XUNFE, said that by the time of KU XUNFE Global Developer Conference on October 24, the Starfire Big Model should achieve Chinese beyond ChatGPT and English to ChatGPT level.

These initiatives and expressions gave a strong impetus to the rise of KDDI's share price. in June 2023, KDDI's share price reached its highest point of 82 yuan per share since its listing, corresponding to a total market capitalization of over 150 billion yuan. Keep in mind that in January 2023, KDDI's market capitalization was less than RMB 80 billion.

Naive Starfire's big model was released after the controversy.

One of the controversies came from a domestic agency called SuperCLUE. The agency's comprehensive benchmark list of Chinese general-purpose big model reviews released on May 9 ranked KDDI's Starfire big model fourth after Human, ChatGPT 4, and ChatGPT 3.5. The SuperCLUE is modeled after the GLUE and SuperGLUE, the authoritative data set for natural language processing, but is actually self-evaluated by domestic private organizations. According to public information, the SuperGLUE list is generally more than 20,000 questions, but the domestic SuperCLUE questions are only 100.

On the day the list was released, SuperCLUE's official website showed that the first Chinese benchmark assessment member advisor was Cui Yiming, a senior researcher at Harvard Xunfei Joint Laboratory. The next day, May 10, the website removed the relevant information. And in the June 2023 Chinese Big Model Ranking, the agency ranked humans at 0, the first and second positions were still ChatGPT, the third and fourth positions became 360 Smart Brain (4.0) and Wenxin Yiyin (v2.0.4), and Xunfei Starfire (v1.5) ranked to the sixth.

The conversation didn't end there.

On May 24, shares of KU Xunfei plummeted, once dropping more than 9% during the day. The official response from KU Xunfei said that the fall in share price was caused by a generative AI product writing a false mini-essay, and the mini-essay mentioned that KU Xunfei was exposed to a large amount of user privacy data and used it for artificial intelligence research as untrue information, the company's legal department will take legal measures if it is found to have malicious disinformation.

The discerning eye will know at a glance that this is pointing the finger at Baidu Wenxin Yiyin.

The person in charge of the market of Wenxin Yiyin Zhang full text on the same day published a circle of friends, said that friends to blame the stock price plunge on Wenxin Yiyin proposition small essay is bumper to bumper, for unwarranted malicious smear smear, Baidu side will also take legal measures, "come and go is not a gift".

According to the actual narrative or bumper sticker marketing, the domestic big model has just hit the road, it is difficult to say which is stronger or weaker, while the distance of the Starfire big model from the KDDI claim to catch up with ChatGPT is there for all to see. In the context of annual revenue growth slipping from 40.61% in 2021 to 2.77% in 2022, it remains to be seen what the big model can bring to the business direction of KDDI.

From Voice to AI

KDDI had a first-mover advantage in the field of intelligent voice in China.

The company, which was founded more than 23 years ago, has already exceeded 100 million yuan in sales in 2004, and its cooperation with Lenovo and Huawei has made it a giant in the field of voice interaction.

In May 2008, KDDI was listed on the Shenzhen Stock Exchange, and in the same year the company's revenue was 257 million yuan, up 25.14% year-on-year. The 257 million yuan was made up of three main businesses, which were voice support software with revenue of 54.58 million yuan, voice industry applications/systems with revenue of 76.31 million yuan, and information engineering and operation and maintenance services with revenue of 126 million yuan. It is particularly noteworthy that the information engineering and operation and maintenance services business, which accounted for 49.17% of the total revenue, was mainly supported by KDDI's corporate location in Anhui, which contributed 99.49% of KDDI's revenue from this business.

Around 2010, when smartphones were on the rise, Xunfei quickly seized the opportunity to launch Xunfei Voice Cloud, and in 2011, it launched its first entry-level voice synthesis chip, which also brought Xunfei Input Method to mobile Internet users. Today, Xunfei Input Method supports speech recognition of 23 dialects including Cantonese, Hakka, Minnan and 5 minority languages such as Tibetan.

In 2014, Xunfei launched the Xunfei Super Brain Program, shifting from NLP to AI. 2015 annual revenue of Xunfei was 2.5 billion yuan, of which the highest proportion was still information engineering and operation and maintenance services, with revenue of 720 million yuan (28.83%); followed by education application products, with revenue of 660 million yuan (26.4%); telecom voice value-added products, with revenue of 313 million yuan (12.52%); voice support software, revenue of 303 million yuan (12.12%); industry application products IFLYTEK-C3, revenue of 247 million yuan (9.91%); the rest accounted for a relatively small share of audio and video surveillance, communication data analysis applications, college education and teaching and other business revenue. In other words, what supports KDDI's revenue is mainly software and information technology services.

With the rapid development of the Internet, many large manufacturers have also cut into the field of voice interaction, which makes the position of KDDI less and less stable. Data from the China Voice Industry Alliance shows that in 2012, KDDI accounted for 54.3% of China's intelligent voice market, which dropped to 44.2% in 2015, with Baidu in second place at 27.8% and Apple in third at 6.9%. Baidu, NetEase and other large manufacturers have their own build-up, which is bound to have an impact on KDDI.

The outside world has also been quite skeptical of KDXF's AI products, such as its e.g. voice interpretation products.In 2018, someone published an article on the internet, arguing that KDXF products actually have a manual translation component when it comes to translation. In response, Xunfei responded that the product uses a "human-machine coupled translation assistant" model, in which the machine provides the results of voice recognition and machine translation to the simultaneous interpreter to assist the work of the interpreter. This is also an objective admission that "Xunfei Hear" is far from the level of simultaneous interpretation and cannot replace simultaneous interpreters with AI.

Despite the shortcomings, Xunfei's business has performed well, with an average revenue growth rate of over 25% for 10 consecutive years. But the more emerging technologies, the faster the iterations within the field, including voice interaction and AI. according to the "2023-2028 China Intelligent Voice Industry Market Development Status and Investment Direction Research Report" released by Huajing Industry Research Institute, China's intelligent voice market size grew from about 10 billion yuan in 2017 to $34.1 billion in 2022, and is expected to reach $38.2 billion in 2023; And those occupying a high domestic market share in 2022 are KDDI (44.2%), Baidu (37.8%), Apple (15.4%), Nuance (6.9%) and Little i Robot (3%).

The voice sector is under pressure, and broad AI is more difficult.

Research institute Ari Consulting "China Artificial Intelligence Industry Research Report" shows that the market size of China's AI industry has reached 154.6 billion yuan in 2020, 195.8 billion yuan in 2022, and is expected to reach 612.2 billion yuan in 2027, with a relevant CAGR of 25.6% from 2022-2027, i.e. compound annual growth rate.

The market is promising and the competition is fierce. In the whole AI industry map, including different fields such as computer vision, big data intelligence, conversational AI, content audit, intelligent driving, etc., the technical layer and specific application layer where KDDI is located need to face directly the attack of domestic Baidu, Ali, Tencent and foreign Google, Microsoft and other big manufacturers.

The financial report shows that KDDI's 2022 revenue was 18.82 billion yuan, an increase of only 2.77%; the first quarter of 2023 revenue was 2.887 billion yuan, a decline of 17.64%. KDDI officials attributed the first quarter performance issue to the special environment in December 2022 and January 202 and the subsequent Chinese New Year holiday, which was considered a short-term shock and did not affect long-term business fundamentals. The official also said that the inclusion in the list of U.S. entities in 2019 was followed by another pressure in October 2022; the fourth quarter of 2022 and the first quarter of 2023 are in the process of adjustment, which, together with the launch of the big model, is expected to result in positive revenue and gross profit growth from the second quarter onwards.

Model success geometry?

According to the financial report, for the full year of 2022, KDDI's main business remains software and information technology services, accounting for 98.41% of total revenue; the largest share of which is education products and services, accounting for 32.74% of total revenue; followed by open platform and consumer business (24.66%), followed by smart city (23.63%) and carrier-related business (11.14%); smart Automotive, Smart Healthcare and Smart Finance together accounted for 6.2%.

The rapid development of AI business requires KDDI to follow the technology trend, and the importance of large models cannot be overstated.

The importance of the big model can be seen by the investment in R&D. The financial report shows that KDDI invested 2.936 billion yuan in R&D in 2021 and grew to 3.355 billion yuan in 2022, up 14.28% year-on-year; the number of R&D staff has increased from 8,367 in 2021 to 9,281 in 2022, up 10.92% year-on-year, and the proportion of the overall staff has increased to 61.68%.

But in fact, excluding algorithms, the difficulty and focus of large model training is the need for huge data and huge computing power, including CPU (central processing unit), GPU (graphics processor), ASIC (special integrated chip) and other hardware devices, as well as software platforms and frameworks to support massively parallel computing, in addition to involving a large amount of data storage, transmission, and related human maintenance and upgrading. nvidia that is, nvidia NVIDIA research data shows that the largest scale model of ChatGPT 3 requires the use of 175 Billions of parameters and requires 512 V100 graphics cards for 7 months or 1024 A100 chips for up to one month, costing over a million dollars per month.

This means that the financial strength of the large factories have more burning money, the general enterprise is difficult to participate in the competition. 2022 year, Ali, Tencent's R & D investment are more than 50 billion yuan, while Baidu in the case of R & D investment of 21.4 billion yuan, its Wenxin a word is still a large gap with ChatGPT, not to mention the same period of R & D investment of only about 3 billion yuan of Keda Xunfei.

Even so, there are still many people who have high hopes for KU Xunfei. This is not only because it has some first-mover advantage in voice and AI, but also because the company carries more or less a national team color. The latest financial report, the first quarter of 2023, shows that state-owned legal person China Mobile Communications Co. and China University of Science and Technology Asset Management Co. are ranked first and fourth among the top 10 shareholders of KU Xunfei, with 10.66% and 3.59% shareholding respectively, while Liu Qingfeng, as founder and chairman, is ranked second with 7.24% shareholding.