Baidu, one of China’s largest technology companies, has announced that its flagship AI chatbot, Ernie Bot, will be free for all users starting April 1, 2025. The decision, detailed in an official membership notice, removes the previous monthly subscription fee of 59.9 yuan (~$8).
The move is widely seen as a response to mounting competition in China’s AI sector, where companies like DeepSeek, ByteDance and Alibababa are rapidly gaining market share. According to AI competition trackers, Baidu has struggled to keep pace with these emerging leaders.
In late 2023, Baidu introduced subscription-based features to monetize Ernie Bot’s advanced capabilities. However, the platform’s adoption rates have not met expectations.
According to the announcement the change also includes the launch of a new advanced search tool, powered by Baidu’s Ernie 4.0 model, which will also be freely available. The tool aims to improve reasoning capabilities and integrate external tools for more precise responses.
Baidu’s decision shows its effort to lower barriers to adoption and attract users who have increasingly gravitated toward alternatives like ByteDance’s Doubao chatbot and DeepSeek’s affordable AI services.
Refund Policies and User Transition
Baidu has outlined a comprehensive refund policy for existing Ernie Bot subscribers as part of this transition. Refunds will be processed automatically for users who purchased subscriptions via Baidu’s official channels without an issued invoice.
For users with invoices, refunds require manual coordination. The company stated in its notice, “Orders purchased through the Wenxin Yiyan official website or app without an issued invoice will be automatically refunded by the system, while orders with issued invoices require user cooperation to process the refund.”
Users who made purchases through third-party vendors will need to follow those platforms’ respective refund procedures.
What Sets Ernie Bot Apart?
Ernie Bot is built on Baidu’s Enhanced Representation through Knowledge Integration (ERNIE) model, a sophisticated AI reasoning model. The latest iteration, Ernie 4.0, incorporates retrieval-augmented generation (RAG), a feature that enables real-time data integration from external sources to improve the accuracy of responses.
This makes the chatbot particularly well-suited for complex tasks such as customer support and content generation. While the model is designed to rival OpenAI’s GPT-4, adoption has been slow.
China’s AI Industry Has Many Players
China’s AI market is among the most competitive globally, with over 130 large language models (LLMs) currently in operation. Baidu was an early mover, launching its Ernie LLM shortly after OpenAI’s ChatGPT debuted in 2022.
However, the rise of ByteDance and DeepSeek has shifted the dynamics of the market. ByteDance, known for leveraging its extensive ecosystem of apps, has integrated its Doubao chatbot into consumer-facing platforms, driving significant user engagement.
DeepSeek, on the other hand, has focused on affordability and high performance, positioning its AI tools as attractive options for startups and businesses. DeepSeek’s API challenges earlier this year highlight the surging demand for its services.
Baidu, however is facing challenges. Despite the introduction of large language models (LLMs) like Ernie 4.0, the company has struggled to maintain momentum. Its recent announcement reflects an acknowledgment of the need to prioritize accessibility to regain its position in an increasingly crowded market.
Strategy Shift
Baidu’s decision to make Ernie Bot free represents a broader shift in its strategy. In 2024, Baidu launched advanced AI-powered smart glasses as part of its efforts to expand beyond chatbot services. These glasses, integrated with Ernie’s capabilities, were positioned as an alternative to offerings from companies like Meta with its Ray Ban smart glasses.
Beyond hardware, Baidu has also focused on integrating Ernie Bot into enterprise applications, such as customer service tools and e-commerce platforms. By prioritizing accessibility, the company hopes to boost adoption rates and position itself as a leader in both consumer and enterprise markets.
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[table “18” not found /]Last Updated on March 3, 2025 11:31 am CET
