ByteDance released a new open-source AI model on Wednesday, aiming to challenge rivals Alibaba (NYSE:BABA) Cloud and DeepSeek in the global market.

Alibaba’s shares traded lower on Thursday following the announcement.

The TikTok and Douyin parent’s Seed division, which drives its AI research and large language model (LLM) development, uploaded three variants of the Seed-OSS-36B model to Hugging Face, an open-source AI development platform.

Also Read: Alibaba Releases New Open-Source AI Models With Multilingual And Code Support

The company designed Seed-OSS-36B with both reasoning and general-purpose capabilities, supporting long-context processing and developer-friendly features, SCMP reported on Thursday.

ByteDance said benchmark tests showed the model matching or surpassing offerings from Alibaba Cloud, Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) Google, OpenAI, and its closed-source Seed 1.6.

The launch follows ByteDance’s proprietary Doubao LLM family, which was released last year.

The rollout also comes over a year after CEO Liang Rubo criticized employees for being slow to adapt to fast-moving AI trends.

Alibaba stock gained 41% year-to-date as it unlocks value via its push for artificial intelligence (AI) and cloud computing and its strategic partnership with Apple (NASDAQ:AAPL) for AI services.

Alibaba and Baidu (NASDAQ:BIDU) each captured roughly 25% of China’s AI cloud market in 2024, while Tencent (OTC:TCEHY) and Huawei trailed with smaller shares, according to IDC.

The market surged 55% to 19.6 billion yuan ($2.7 billion), fueled by disruptive AI innovations that shifted demand from traditional applications to large language models and autonomous agentic services.

Price Action: BABA stock is trading lower by 1.08% to $118.20 premarket at last check Thursday.

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