Rolling with ChinaTech
DeepSeek the new benchmark, Rednote's missed opportunity, TikTok in limbo, and looming question of coexistence in the US-China tech landscape
Last week, I had the pleasure of sharing my thoughts with Young China Watchers. The topic: “Rolling with ChinaTech Resurgency” and we had no shortage of stories to talk about, from DeepSeek to Rednote to TikTok. Below is a condensed version of the latest news, analysis and the discussions at the event.
Rednote, TikTok and DeepSeek
The unfortunate truth is that it was a missed opportunity and Rednote’s popularity has not maintained momentum. Bloomberg reported that in the five days following TikTok's return to the app stores, downloads of social app Rednote plummeted by 91%. TikTok itself more than doubled its usual downloads once it was brought back, while all competitors that had gained from its brief removal saw declines, from YouTube and Snap to Facebook and Instagram.
TikTok’s fate remains in limbo. No deal is finalized and key issues, such as ownership of TikTok's algorithms, remain unresolved. But Beijing has also appeared to soften its stance and would not object to American investors owning more of the app, as long as the algorithms remain in ByteDance's control. And it was just announced today that Reddit Co-founder has joined “the people’s bid” for TikTok.
TikTok’s competitors are trying to take over some audience share. Meta may launch Reels as a separate app to replicate the TikTok experience, while Substack is boosting its video capabilities to capitalize on market gaps.
DeepSeek is still all in AGI, and I think DeepSeek’s secret sauce is different from its peers. It’s more than the technical capabilities—its use cases are broader, it could be emotional companionship and a fortune teller for China’s youth. The ethos is best captured by this Bloomberg reporter—
Involution in the AI space is heating up. Tencent unveiled its Turbo AI model last week, claiming it outperforms DeepSeek in speed. Just a month ago, Alibaba showcased its latest Qwen (通义千问) AI, signaling an intensifying race in China's AI landscape. The involution is in full swing.
What stands out to me is that DeepSeek has become the new benchmark for technical prowess—companies are eager to position themselves in relation to it. There’s a rush to integrate DeepSeek in China, not just for its capabilities but for the newsworthiness and perception of cutting-edge innovation it brings. From robot vacuums and smart appliances to state-owned enterprises, hospitals, and local governments, adoption of DeepSeek is spreading rapidly.
Some of these adoptions will be publicity stunts with no real impact, but the broader willingness to experiment—and the sense that trial and error is both supported and encouraged by the government—is a meaningful step in the right direction.
However, a fundamental challenge remains: the scaling law still holds, and it is hard to maintain a leading edge just by algorithm improvement.
US Legislative Pushback Against DeepSeek
On Friday, legislation was introduced by a bipartisan group of senators moving to ban DeepSeek on government devices. Earlier this month, similar legislation was introduced in the House, and New York, Virginia, and Texas have already banned DeepSeek from state devices and networks.
“The bill, introduced by Sens. Jacky Rosen (D-Nev.), Jon Husted (R-Ohio) and Pete Ricketts (R-Neb.), comes as DeepSeek’s rapid rise in popularity has sparked data privacy and national security concerns. “
"As the artificial intelligence landscape continues to rapidly expand, the U.S. must take steps to ensure Americans' data and government systems remain protected against platforms — like DeepSeek — that are linked to our adversaries," Rosen said in a statement. "DeepSeek is a tool that perpetuates Communist China's agenda—full stop," Husted said. "It exposes Americans' data to our adversary's government, lies to its users, and exploits American workers' AI advances. We can't afford for U.S. officials to play into Beijing's hands by hosting this hostile bot on their devices."
Sound familiar? Reads like the TikTok bill… just replace DeepSeek with TikTok.
The US-China Relationship: Who Gets to be Exceptional?
China's growth has been anemic, and the US has been stuck in a persistent cultural and political partisan divide over the past couple of years. Both sides have taken a defensive approach to positioning their place in the world and the nature of the relationship with each other. The US often takes a moral high ground, throwing around words like 'national security,' 'Xinjiang,' and 'surveillance' at the slightest provocation. Meanwhile, China constantly works to justify its own narrative on the global stage.
said it best in his recent essay:“At this critical juncture, one question looms large: Is it possible for these two great powers, each convinced of its unique role in human history, to find a way to coexist? More specifically, can American exceptionalism accommodate Chinese exceptionalism in the 21st century?"
Lastly, but not the least China's Economic Outlook:
The Two Sessions are approaching, and they're expected to reveal a more pro-growth agenda compared to last year, with approximate targets of 5% for GDP growth and 2% for consumer inflation.
For more “predictions,” head over to Asia Society’s Center of China Analysis to read on.