Over 600 million Chinese residents have already used some form of AI application. The pace of integrating this technology into daily life is remarkable, writes The Economist.
“The country is rapidly moving towards a future where artificial intelligence will select, purchase, and deliver many goods and services, fundamentally transforming the digital economy,” the article states.
The publication noted that to have coffee delivered to an office in Shanghai, one only needs to ask an app to choose the drink and confirm the order—it will be dispatched immediately.
However, outsourcing such decisions carries risks. A journalist from The Economist, upon requesting a “special” coffee, received a drink with a vinegar taste and rose petals.
The Third Internet Era
Chinese internet users have experienced two eras of internet development:
- since the early 2000s, most used the Baidu search engine;
- after Google’s departure at the end of the decade, Baidu became a monopoly and began aggressively monetizing services, leading to user dissatisfaction. With the spread of smartphones, they turned to super-apps—applications combining shopping, entertainment, communication, and payments.
As a result, major tech companies like Alibaba, ByteDance, and Tencent have extensive portfolios of digital services and logistics networks, which can be used to develop autonomous solutions for various user tasks.
Any of these tech giants could become a leader in the new era of China’s internet. The chaotic AI race has already begun, writes The Economist.
On May 11, Alibaba fully integrated its chatbot Qwen into the Taobao shopping app. This allows users to purchase a wide range of goods and services with simple commands.
ByteDance is preparing for a similar release—merging Doubao with Douyin.
Tencent has become the “dark horse” in this race. Its investments in AI models were initially modest, but over the past six months, it has completely restructured its AI team.
The firm’s new model—Hy3—is in the testing phase and shows promising results. Tencent is gradually integrating it into WeChat.
AI Super-Apps
AI-based super-apps could become an attractive source of growth during a period of low consumer spending in China.
The adjusted operating profit of Alibaba’s Chinese e-commerce division in the first quarter of 2026 fell by 40% compared to the same period last year. The company’s cloud business is thriving, but this growth requires massive capital investment.
Chinese tech giants claim their AI super-apps do not promote advertised products. However, they may need to change this policy, The Economist notes.
An Element of Protection
Chinese firms may fear the emergence of AI-based devices with built-in operating system agent functions that could displace super-apps.
OpenAI is working on such a gadget. The new product can fully understand the user’s environment and life. It is unobtrusive, can fit in a pocket or on a table, and “will become the third main device after the MacBook Pro and iPhone.”
ByteDance attempted a similar release in December, launching a smartphone with a pre-installed AI assistant in collaboration with electronics manufacturer ZTE. The project failed, partly because Alibaba and Tencent blocked its access to their payment platforms.
In March, Xiaomi announced the release of new AI models to be integrated into smartphones and cars. Huawei may also join this battle.
As China’s internet enters a new era, it faces fierce competition for dominance, The Economist concluded.
In August 2025, China outlined its national AI integration goals.