Chinese AI Startups Expected to Surge with Low-Cost Models Amid Lunar New Year (2/15-2/24/2026)

February 12, 2026 — One year after DeepSeek disrupted the global AI landscape with a low-cost model, domestic rivals are ramping up launches during the Lunar New Year period, with major announcements expected between Feb. 15 and Feb. 24. Zhipu AI released an enhanced model with stronger coding and long-context capabilities. ByteDance unveiled Seedance 2.0, touting rapid cinematic video generation, and is rolling out Doubao 2.0, China’s most popular AI app with 155.2 million weekly active users as of QuestMobile. DeepSeek is preparing V4, while Alibaba is expected to release Qwen 3.5 with improved math and coding. Low-cost, open-source foundation models now dominate, with RAND and Omdia reporting Chinese systems operate 1/4–1/6 the cost of U.S. equivalents. Chinese firms increasingly open-source and invest in researcher talent to integrate AI into consumer services, reflecting monetization pressures, while DeepSeek remains research-focused under its fund parent.