By Rajwa Quasim
Alibaba plans to ask major users of its upcoming Qwen open-source AI model to hand over a share of the revenue they generate from products and services built using the technology, Reuters reported.
The new model, Qwen 3.8-Max, is an open source and open weight, which means the developers can use the core settings and modify themselves. That’s different from AI models developed by U.S. companies like OpenAI, Anthropic, and Google, as these models are closed. However, being open source does not necessarily mean the model will be completely free. Alibaba plans to introduce licensing terms that would require large businesses using the model to negotiate commercial agreements and share part of the revenue generated from their services.
Recently, similar strategy was adopted by Chinese AI startup Moonshot with its Kimi K3 model. Under Kimi K3’s licensing terms, anyone reselling it as a service and making more than $20 million a year needs to strike a paid deal with the company. Moonshot can seek as much as 30% share of the revenue under those arrangements.
But Alibaba’s planned revenue sharing rate has not been decided yet, said the sources to Reuters. The company is likely to introduce the new licensing measure next week. Since the plans are not announced publicly, sources requested anonymity.
Previously, Alibaba charged only for its models when they ran on Alibaba’s own cloud platform, and most of its open-source releases could be used for free in customer’s own data centers.
Paddy Srinivasan, CEO of cloud company Digital Ocean, which offers Kimi K3 and other Chiniese model said, “You pay for collaboration with these open-weight model labs to make sure that you’re optimizing your deployment. You pay for getting early access for the next revision of the model. This is a tried and tested open-source ‘freemium’ model. “Freemium model is a strategy where companies offer basic access at little or no cost, while charging for heavy commercial use, additional services or early access to new technology.
The U.S. has accused Chinese AI startup Moonshot of using Anthropic’s advanced Fable model to help develop its latest Kimi K3 model. Michael Krastsios, a senior Trump administration tech official claims that Moonshot had obtained advanced GB300 AI chips from Nvidia to create the K3 model.
“We have information that Moonshot AI distilled Anthropic’s Fable for the development of its K3 model,” he said in a post on X. “Large-scale, covert industrial distillation aimed at stealing proprietary U.S. technology and undermining American research is unacceptable.”
Chinese officials countered the allegations as “entirely unfounded” and that China respects intellectual property. He further stated, “Relevant individuals in the United States should respect the facts, discard prejudice and stop smearing and discrediting China’s achievements in the development of its artificial intelligence industry.”
Chinese models offer lower prices compared to the U.S. for instance, Kimi K3 is priced at roughly one-third of Anthropic’s Fable. As users opt for cheaper models, it will create a tension in the American AI developers.