**Florence Lo | Reuters** **BEIJING** — According to a source familiar with the situation, Baidu of China is set to unveil the next generation of its artificial intelligence model in the latter half of this year, as emerging competitors like DeepSeek begin to disrupt the field. The upcoming model, Ernie 5. 0, is categorized as a "foundation model" and is expected to introduce substantial "enhancements in multimodal capabilities, " as stated by the source, who did not disclose specific functions. "Multimodal" AI facilitates the processing of texts, videos, images, and audio, enabling the integration and conversion of these formats—such as transforming text into video and vice versa. Foundation models possess the ability to comprehend language while accomplishing a variety of tasks, including text and image generation, as well as engaging in natural language communication. Baidu's anticipated update arrives amid a race among Chinese firms to create cutting-edge AI models that can rival those of OpenAI and other American tech companies. In late January, the Hangzhou-based startup DeepSeek caused a stir in the global tech market with its open-source AI model, which garnered attention for its impressive reasoning abilities and claims of significantly reducing costs compared to OpenAI's ChatGPT. Get a weekly summary of the leading tech stories from around the world delivered to your inbox every Friday. **Subscribe** "We are in an exhilarating period . . . The inference cost [of foundation models] can potentially be decreased by over 90% within 12 months, " stated Baidu CEO Robin Li during the World Governments Summit in Dubai this week, according to a press release detailing his conversation with UAE's minister of state for artificial intelligence, digital economy, and remote work applications, Omar Sultan Al Olama. Li emphasized that reducing costs by a certain percentage would inherently boost productivity by a similar percentage, commenting, "I believe that's essentially what innovation entails. " Baidu was the first significant Chinese tech firm to introduce a ChatGPT-like chatbot, known as Ernie, in March 2023. However, following its initial success, the product has been overshadowed by other AI chatbots from both startups and large tech players like Alibaba and ByteDance. While Alibaba's stock has surged 33% this year, Baidu's shares have risen only 6%.

Tencent has experienced gains of approximately 4% this year, while ByteDance remains unlisted. **Watch Now** Baidu's Ernie model already facilitates the integration of generative AI across various consumer and business products, including cloud storage and content generation. Last month, Baidu reported that its Wenku platform for crafting presentations and documents reached 40 million paying users by the end of 2024, marking a 60% increase from the end of 2023. New features allowing AI to generate presentations from a company's financial reports were introduced to users in January. The existing version of the Ernie model is Generation 4, which was released in October 2023. An upgraded "turbo" version, Ernie 4. 0, was made available in August 2024. Baidu has yet to officially confirm plans for the next generation update. The latest iteration of OpenAI's ChatGPT, GPT-4o, was launched in May 2024. OpenAI CEO Sam Altman mentioned in a Reddit "ask me anything" session earlier this month that no public timeline exists for the release of GPT-5. Baidu has not commented on a request for additional information.