TheChek News Flow

Chinese firms continue to release AI models that rival the capabilities of systems developed by OpenAI and other U.S.-based AI companies.

This week, MiniMax, an Alibaba- and Tencent-backed startup that has raised around $850 million in venture capital and is valued at more than $2.5 billion, debuted three new models: MiniMax-Text-01, MiniMax-VL-01, and T2A-01-HD. MiniMax-Text-01 is a text-only model, while MiniMax-VL-01 can understand both images and text. T2A-01-HD, meanwhile, generates audio — specifically speech.

MiniMax claims that MiniMax-Text-01, which is 456 billion parameters in size, performs better than models such as Google’s recently unveiled Gemini 2.0 Flash on benchmarks like MMLU and SimpleQA, which measure the ability of a model to answer math problems and fact-based questions. Parameters roughly correspond to a model’s problem-solving skills, and models with more parameters generally perform better than those with fewer parameters.

As for MiniMax-VL-01, MiniMax says that it rivals Anthropic’s Claude 3.5 Sonnet on evaluations that require multimodal understanding, like ChartQA, which tasks models with answering graph- and diagram-related queries (e.g., “What is the peak value of the orange line in this graph?”). Granted, MiniMax-VL-01 doesn’t quite best Gemini 2.0 Flash on many of these tests. OpenAI’s GPT-4o and an open model called InternVL2.5 beat it on several as well.

Of note, MiniMax-Text-01 has an extremely large context window. A model’s context, or context window, refers to input (e.g., text) that a model considers before generating output (additional text). With a context window of 4 million tokens, MiniMax-Text-01 can analyze around 3 million words in one go — or just over five copies of “War and Peace.”

For context (no pun intended), MiniMax-Text-01’s context window is roughly 31 times the size of GPT-4o’s and Llama 3.1’s.

The last of MiniMax’s models released this week, T2A-01-HD, is an audio generator optimized for speech. T2A-01-HD can generate a synthetic voice with adjustable cadence, tone, and tenor in around 17 different languages, including English and Chinese, and clone a voice from just 10 seconds of an audio recording.

MiniMax didn’t publish benchmark results comparing T2A-01-HD to other audio-generating models. But to this reporter’s ear, T2A-01-HD’s outputs sound on par with audio models from Meta and startups like PlayAI.

With the exception of T2A-01-HD, which is exclusively available through MiniMax’s API and Hailuo AI platform, MiniMax’s new models can be downloaded from GitHub and the AI dev platform Hugging Face.

Just because the models are “openly” available doesn’t mean they aren’t locked down in certain aspects, however. MiniMax-Text-01 and MiniMax-VL-01 aren’t truly open source in the sense that MiniMax hasn’t released the components (e.g., training data) needed to re-create them from scratch. Moreover, they’re under MiniMax’s restrictive license, which prohibits developers from using the models to improve rival AI models and requires that platforms with more than 100 million monthly active users request a special license from MiniMax.

MiniMax was founded in 2021 by former employees of SenseTime, one of China’s largest AI firms. The company’s projects include apps like Talkie, an AI-powered role-playing platform along the lines of Character AI, and text-to-video models that MiniMax has released in Hailuo.

Some of MiniMax’s products have become the subject of minor controversy.

Talkie, which was pulled from Apple’s App Store in December for unspecified “technical” reasons, features AI avatars of public figures, including Donald Trump, Taylor Swift, Elon Musk, and LeBron James, none of whom appear to have consented to being featured in the app.

In December, Broadcast magazine reported that MiniMax’s video generators can reproduce the logos of British television channels, suggesting that MiniMax’s models were trained on content from those channels. And MiniMax is reportedly being sued by iQiyi, a Chinese video streaming service that alleges MiniMax illicitly trained on iQiyi’s copyrighted recordings.

MiniMax’s new models arrive days after the outgoing Biden administration proposed harsher export rules and restrictions on AI technologies for Chinese ventures. Companies in China were already prevented from buying advanced AI chips, but if the new rules go into effect as written, companies will be faced with stricter caps on both the semiconductor tech and models needed to bootstrap sophisticated AI systems.

On Wednesday, the Biden administration announced additional measures focused on keeping sophisticated chips out of China. Chip foundries and packaging companies that want to export certain chips will be subjected to broader license requirements unless they exercise greater scrutiny and due diligence to prevent their products from reaching Chinese clients.

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A putative tie-up between Switzerland’s SGS and France’s Bureau Veritas sent the combined market capitalisation dipping

In most sectors, big is most definitely better. Corporate behemoths are more profitable, have stronger brands, can more easily attract talent and build capabilities, and tend to take share from minnows. The business of auditing financial accounts, by way of example, is largely concentrated among the Big Four. 

Not so the business of auditing real-world stuff — a roughly €150bn market that involves inspecting beaches for cleanliness, testing products for quality, and certifying processes for compliance. The top 10 companies only hold about a quarter of the market according to Karl Green at RBC Capital. A potential €32bn tie-up between two of its leading players — Switzerland’s SGS and France’s Bureau Veritas — has gone down like an adulterated yoghurt, with the combined market capitalisation dipping on Wednesday. 

That reflects the specifics of this sector, which deals in the rich tapestry of the physical world. Sums, spreadsheets and — to a large extent — accounting standards are universal. Work can be optimised to increase efficiency. But a unit that sends out marine experts with clipboards to inspect ships, for instance, cannot easily take on a job inspecting clothing for residue chemicals.

While there would be room to slim down corporate overheads, that’s unlikely to be transformative. This limits the possibility of SGS — the larger business with a SFr16.4bn (€17.5bn) market capitalisation — paying much of a premium for Bureau Veritas without destroying value. 

Market share gains, too, may prove elusive. The cost of testing, inspection and certification (TIC) is relatively small. That does not give clients much of an incentive to shop around, which makes for sticky relationships with existing suppliers. 

For the inspectors, a merger makes most sense as a defensive move. The TIC market will at some point need to transform to keep up with the world around it. Human testers will, over time, be replaced by sensors and drones. Artificial intelligence can help create product prototypes, which can then be put through their paces on laptops rather than in labs. That will require a cycle of capital investment better shared than borne alone. 

On top of that, the market for TIC services isn’t looking quite as hot as it was. Secular drivers of demand include economic growth, increasing regulation and international trade. That squares poorly with President-elect Donald Trump’s desire to impose tariffs and his dislike of clean energy pledges and red tape.

That a bigger entity could better withstand heavy investments and lumpier demand makes intuitive sense. But if the test is one of appealing to investors, this putative union could struggle to scrape through.