Why Alibaba Stock Bounced Back on Thursday
What happened
A day after Alibaba (NYSE: BABA) stock took it on the chin due to a draft law on smart devices in its native China, the company was a winner on Thursday. Its shares rose nearly 3% higher on the day, on the back of a new product announcement in a white-hot segment of the tech market.
So what
That day, Alibaba announced the launch of not one but two artificial intelligence (AI) models, Qwen-7B and Qwen-7B-Chat. What's more, it has made them open source, meaning that developers and other interested parties are free to access the code that undergirds them.
There are some, but not many, restrictions to this access. Alibaba said it will require businesses with over 100 million monthly active users to obtain a license in order to tap into the large language models (LLMs).
Qwen-7B and Qwen-7B-Chat are both scaled-down versions of a more sprawling Alibaba LLM called Tongyi Qianwen. This was unveiled in April.
All of this might sound familiar to Meta Platforms investors and observers. Last month, the U.S. social media giant rolled out its own open-source LLM, evocatively named Llama 2. Like Alibaba, it requires companies of a certain size -- in its case, over 700 million users -- to hold a license in order to use Llama 2. Meta has not yet officially reacted to Alibaba's latest AI news.
Now what
The growth of AI as a top aspect of the modern tech industry continues at an astonishing rate. With the rollout of yet another open-source platform, it's reasonable to expect massive leaps in the technology. Investors were right to trade up Alibaba on its news.
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