The Doubao "family bucket" is booming in the market, and ByteDance's R&D investment is close to that of BAT combined, with ByteDance becoming China's OpenAI.

In a report on the 25th, Zheshang pointed out that ByteDance is offering its leading Doubao large model free to the public, which demonstrates signs that ByteDance is expected to lead the industry from both its investment efforts and market share.

R&D investment is close to that of BAT combined.

Specifically, Zheshang stated that ByteDance is increasing traffic investment, expanding capital expenditures, and aggressively expanding its team. Its R&D investment is significantly ahead of its peers, comparable to Microsoft's increased investment in OpenAI; ByteDance in China may be likened to OpenAI in the USA.

In terms of expenditure scale, Zheshang pointed out:

ByteDance is investing heavily in AI, with capital expenditures reaching 80 billion yuan in 2024, close to the total of Baidu, Alibaba, and Tencent (approximately 100 billion yuan). In 2025, ByteDance's capital expenditures are expected to reach 160 billion yuan, aimed at building a self-controlled large-scale Datacenter cluster, with around 90 billion yuan allocated for AI computing power acquisition and 70 billion yuan for IDC Infrastructure and network equipment like optical modules and Switch.

The booming development of overseas large models is inseparable from significant computing power investment, and ByteDance's massive computing power expenditures are expected to drive the overall development of China's AI industry. ByteDance estimates high future Token consumption and plans to continue increasing computing power investments. In September 2024, Wu Di, head of intelligent algorithms at ByteDance's Volcano Engine, stated that the daily Token consumption of Doubao is expected to exceed 100 trillion by 2027, which is more than 100 times the previous amount.

In terms of promotion efforts, Zheshang stated that ByteDance has taken strong advertising measures to promote its AI products:

For example, the advertising spending for Doubao Smart Assistant was close to 18 million yuan from April to May 2024, and it soared to 0.124 billion yuan in early June. At the same time, the company leveraged internal traffic advantages from platforms like Douyin to drive traffic to its AI products. In an environment where many large models require payment, the Doubao large model is open to the public for free while ensuring performance, which helps to quickly increase the number of users and plays a role in expanding market share and acquiring massive training data.

Regarding talent investment, Zheshang stated:

According to Securities Times, the company's founder Zhang Yiming is not only personally responsible for recruiting AI talent from competing companies but has also repeatedly emphasized the pursuit of the goal of "general AI" internally. Members of the large model team come from ByteDance's core departments, with the language portion led by the search team and the image portion led by the intelligent creation team under the product research and engineering architecture department.

The product is aligned with GPT-4.

From the product perspective, the Doubao large model family has been newly upgraded to align with GPT-4. Zheshang stated:

On December 18, 2024, the Byte Volcano Engine Winter FORCE Power Conference was held, announcing the brand new upgrades in the Doubao large model family. The Doubao general model pro has improved its comprehensive task processing capability by 32% compared to May, fully aligning with GPT-4o, and its usage price is only 1/8 of the latter. In addition to the model upgrade, the Volcano Engine has also upgraded three platform products: Volcano Ark, Button, and HiAgent, helping enterprises build their own AI capability centers and efficiently develop AI applications.

As of November 2024, according to AI product rankings, Doubao App's monthly active users have approached 60 million, second only to OpenAI's ChatGPT, ranking second globally, with a MAU growth rate of 16.92%.

Additionally, ByteDance, as a company driven by AI algorithms, has a rich and diverse array of AI application scenarios downstream, allowing for the implementation of large model technology. Zheshang introduced:

1) Recommendation Algorithm: As a more powerful AI, large models are expected to enhance the effectiveness of recommendation, advertising, and search algorithms, thereby empowering ByteDance's core businesses such as Douyin and Toutiao. 2) Content Creation: AIGC empowers UGC and PGC. The AIGC sci-fi short series "Sanxingdui: Future Revelation" jointly produced by Douyin is launched on Douyin and all platforms. Creators on platforms such as Douyin can also assist their creations by using Doubao's "one-click picture" and "one-click poster" functions. Tomato Novel has implanted character robots that can simulate conversations between characters in the novel and readers. 3) Office Applications: Feishu has launched smart partners to extract meeting highlights and generate documents, tables, mind maps, data analysis functions, and more.