This Spring Festival has been recast as a battlefield: China’s biggest tech firms are turning the country’s most lucrative social moment into a live commercial test for generative AI. From algorithmically generated red envelopes and short videos to integrated local services, Alibaba, Tencent, ByteDance, Baidu and other players have poured unprecedented budgets and engineering effort into winning users during the holiday.
For ordinary users the encounter is festive and frictionless: ordering a “sponsored” milk tea through an app, tapping a Tencent red envelope (元宝, Yuanbao) or Alibaba’s 千问 (Qianwen) coupon, sharing a machine-made greeting clip, then refreshing when the link is blocked or the service temporarily crashes. Platforms that once welcomed viral links have begun policing them — WeChat moved to hide many promotional red‑envelope commands — exposing the tension between rapid distribution and platform hygiene.
The spending is vast. Tencent publicly committed RMB 10 billion, Qianwen 30 billion and Baidu RMB 5 billion to Spring Festival campaigns, while ByteDance and Ant Group ran quieter but deep-pocketed pushes. Seedance 2.0, ByteDance’s new video-generation model released in the days before the holiday, drew immediate global attention, and Alibaba has explicitly welded Qianwen into Taobao, Alipay, travel and local services as part of a newly formed C-end business unit.
That firepower masks another reality: an acute shortage of compute and the human labour that keeps it running. Operations engineers and backend teams have been the unsung protagonists of the holiday. Staff who maintain GPU clusters sit on high alert; model rollouts and traffic surges repeatedly brought systems to the edge of collapse. “Three years without a good New Year,” one senior AI executive sighed, noting that project core teams were required to be on duty through the festival.
Smaller AI vendors and cloud providers are scrambling. Last year’s DeepSeek frenzy showed how a runaway model can overwhelm infrastructure and create openings for nimble providers to capture overflow demand. In response, the market is bifurcating: the megacap firms have pre‑booked much of the available compute capacity, while mid‑sized players look to domestic GPU suppliers and efficiency software to compete on deployment speed and cost.
The strategic stakes are high. China’s internet history shows that major tech waves take root first as entertainment. A holiday that produces viral, widely used AI experiences can change everyday habits and social norms overnight. Official statistics cited in the Chinese report indicate generative AI users reached about 6.02 billion by the end of 2025 with a 42.8% penetration rate — a scale that makes the Spring Festival a uniquely fertile testing ground for mass adoption.
Market dynamics suggest this year will be less about sudden outsider breakthroughs and more about execution by established giants. Model performance among top-tier providers is converging and compute is concentrated, reducing the odds of an unheralded “black horse” becoming dominant. For smaller firms the path forward is uncertain: participating in the fray directly is costly and often futile, yet complementary niches — faster integration, vertical expertise, or compute optimisation — may still yield commercial returns.
The human and governance consequences are immediate. Engineers’ holiday labour underscores the human costs of rapid deployment; platform interventions, such as WeChat’s link blocks, point to moderation and regulatory secondary effects. Consolidation moves within ecosystems — Alibaba’s internal unification of services around Qianwen, for example — highlight how AI is accelerating platform strategies that marry large user bases to fresh generative capabilities.
Viewed historically, this Spring Festival may mark the transition from an era of headline model-building to an era of large‑scale application. If one of the major experiments — short video plus AI, social messaging plus AI, or local services plus AI — produces a lasting change in user behaviour, the result will be a decisive push for AI to reshape software and consumer markets across China. For the engineers, entrepreneurs and capital behind the scenes, the holiday was less a break than a launch window for a new commercial cycle.