ByteDance leads China’s big tech spending with $11B in 2024

ByteDance’s major competitors, Baidu, Alibaba, and Tencent invested a combined 100 billion yuan collectively this year, as reported by the South China Morning Post, citing a research note from Zheshang Securities.

The Beijing-based company, founded by Zhang Yiming, generates significant cash flow from Douyin, the Chinese counterpart of TikTok. The company is expected to double its capital expenditure to 160 billion yuan in 2025, with 90 billion yuan allocated for computing power. The exact allocation for AI was not specified.

While China’s Big Tech firms are ramping up their AI spending, they still trail behind their U.S. counterparts.

Microsoft’s capital expenditure in 2024 reached US$44.5 billion, according to the research note.

TikTok, a video-sharing social media platform owned by the Chinese company ByteDance. Photo by Reuters

Zheshang Securities notes that ByteDance’s substantial investment in computing infrastructure is set to accelerate progress within China’s AI sector.

The company’s expanding AI capabilities are poised to enhance its core platforms, including the short-video app Douyin and the news app Jinri Toutiao, by refining their recommendation algorithms and search functionalities.

ByteDance’s AI chatbot, Doubao, which launched in May, has quickly become China’s most popular AI chatbot, reaching nearly 60 million monthly active users by November. Doubao competes with OpenAI’s GPT-4, excelling in areas such as reasoning, coding, and instruction-following.

Globally, Doubao ranks as the second most popular AI product by monthly active users (MAUs), behind OpenAI’s ChatGPT, according to a November ranking from Aicpb.com.

ByteDance’s AI portfolio now includes around 20 distinct AI-driven projects, underscoring its significant push into the emerging field of artificial intelligence.