Baidu is set to launch the next generation of its Ernie AI model, the Ernie 4.5, in mid-March. This upgraded version will feature improved reasoning capabilities and enhanced multimodal functions, allowing it to process and integrate a variety of data formats, including text, images, audio, and video. Baidu also plans to make the Ernie 4.5 series open source from June 30, marking a significant shift in its approach to AI development.

The Chinese tech giant has faced fierce competition in the AI race, particularly from the rising startup DeepSeek, whose models are seen as rivals to leading US systems at a much lower cost. Despite claiming that Ernie's performance is comparable to OpenAI's GPT-4, Baidu has struggled to gain widespread adoption of its AI model. The emergence of DeepSeek has further complicated Baidu's aspirations in the sector, leading the company to reassess its strategy.

Baidu's CEO, Robin Li, who once advocated for keeping AI models closed-source, has acknowledged the success of DeepSeek and other competitors. He now views the open-source approach as essential for the future of AI development. This shift comes as Baidu continues to compete with other tech giants, including Alibaba, which recently announced its plans to make its video and image-generating AI model, Wan 2.1, open source.