American AI companies are increasingly adopting Chinese open source models, which can be significantly cheaper than leading models from OpenAI and Anthropic.
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As Reuters reported, Chinese authorities are in discussions about potentially restricting overseas access to the country’s leading AI models, many of which are open source. Beijing has taken a series of measures in recent months to keep out its cutting-edge and cost-effective models, talent and startups – including ordering Meta to handle its $2 billion acquisition of AI startup Manus and blocking foreign investment in China-linked companies. Paradoxically, such strict rules are contributing to some Chinese founders moving to the US. Forbes Reported earlier this year.
But American AI firms are increasingly adopting Chinese open source models, which can be 60 to 90 percent cheaper than leading models from OpenAI and Anthropic, CNBC reported. Additionally, they allow developers greater control over how the models work. OpenRouter, a startup that allows U.S. companies to use various AI models to answer queries, said the amount of work being routed to Chinese models has been steadily increasing and is at about 30 percent, according to the report. Some young startups have switched all their traffic to models developed by Chinese companies like DeepSeek. That could mean trouble for these companies if China blocks access.
Joseph Spisak, VP of product and head of open source at Reflection, an AI startup that develops core open source models, says some companies risk becoming “locked in” to the Chinese AI ecosystem, especially if they are getting used to using a Chinese AI model or have already developed applications based on it. “Once you’re… excited about the technology, I think there’s a certain inertia. And it becomes harder and harder to move on from that,” he says.
China’s potential export controls on its models could provide a strong tailwind for Reflection, which was founded in 2024 by Google DeepMind researchers Misha Laskin and Ioannis Antonoglou to become an American open-source alternative to China (it is backed by 1789 Capital, where Donald Trump Jr. is a partner). The company, valued at $25 billion, has not yet released an open source model to the public.
Now let’s get to the headlines.
BIG GAMES
OpenAI discussed to give the Trump administration a 5 percent share in the $852 billion valued AI giant, the Financial Times reported. The ownership stake could help keep the company in the government’s good graces while offering Americans a potential opportunity to benefit from the wealth of AI companies. The talks, which are at an early stage, Other AI giants would also be included in the “conceptual” phase to give the government a 5 percent stake, but it is not clear whether these companies will be included in the talks. CEO Sam Altman has proposed the establishment of a state asset Fund similar to the Alaska Permanent Fund that invests the state’s oil wealth in stocks and pays dividends to state residents and government services. Granting the Trump administration an ownership interest could set off alarm bells for companies abroad that rely on OpenAI’s models to power their systems.
CHIPS + COMPUTES
As Anthropic, OpenAI and SpaceX-owned Cursor compete to attract enterprise customers, they are Providing millions of dollars worth of free credits and counting to gain market share, the Wall Street Journal reported. Cursor even offered a 75 percent discount on its software. The bounty allowed it Some aspiring startups start building without raising seed capital at all.
Also noteworthy: According to Reuters, Chinese AI darling DeepSeek is developing its own chip. Other leading Chinese AI players such as Alibaba and ByteDance also have their own chip initiatives to reduce their dependence on Nvidia and Huawei.
PEOPLE OF AI
A little known A Georgia based company called Southwire produces half of the electrical wires and cables used to distribute electricity in the United States Wiring reaches about half of American homes. Now it starts booming market for AI data centers. With $9.7 billion in sales in 2025The company is owned by the Richards, one of the richest families in the country with a net worth of around $13.1 billion. Forbes Estimates.
Show me the money
Mercor, a startup that recruits experts in fields such as physics, finance and law to label AI training data, has done this generated more than $2 billion in annual recurring revenuefour months after ARR hit $1 billion, CEO Brendan Foody posted on LinkedIn. “Civilization’s attempt to collect data is underway,” wrote Foody, one of the world’s youngest billionaires.
Dive deep
When OpenAI wants to convince the country’s largest health systems of its healthcare ambitions, it often brings in a person a hospital CEO won’t ignore: Sam Altman.
Altman, 41, is the billionaire co-founder, CEO and chief implementer of skepticism in orders of OpenAI. He has sold investors, board members and governments on the idea that OpenAI is the engine of the next computing age. Now he is personally making this case to hospitals.
Altman’s involvement in these sales discussions underscores how this works Centralized healthcare meets OpenAI’s ambitions. In January, the AI giant announced that eight major health systems, including Cedars-Sinai Medical Center and HCA Healthcare, are now customers of its enterprise health tools.
OpenAI has too has solicited hundreds of doctors to improve its healthcare solutions for health more than 230 million people worldwide who turn to ChatGPT every week for advice. It introduces a new version of ChatGPT for clinicians, as well as “ChatGPT Health,” a tab in the main app that allows consumers to securely connect their medical records and their wellness apps such as Apple Health and MyFitnessPal (currently waitlisted only). And its models support other healthcare companies’ tools to create clinical notes and help consumers understand their lab results. OpenAI has In the last six months alone, the company has launched three new healthcare-focused products.
“It is one of our most important industries at OpenAI,” says Nate Gross, who leads OpenAI’s healthcare strategy. Gross, who joined OpenAI in 2025, has an MD from Emory University School of Medicine and an MBA from Harvard and previously co-founded the $4 billion healthcare network Doximity. While the company also ventures into other major markets such as education and finance, Gross says, “Everyone has health issues and this is an opportunity to help everyone.”
After all, healthcare accounts for about 18% of the entire U.S. economy. And AI has enormous potential to help consumers make better decisions about their health, help doctors provide better care, and help health systems operate more efficiently—if done right.
Continue reading the full story Forbes.
MODEL BEHAVIOR
Tents are not just for camping. Meta has built data centers in dozens of huge tents in Ohio, TechCrunch reported. The weatherproof structures, which can store hundreds of power-hungry AI chips, can cut construction time in half and dramatically reduce costs. “The The AI race has officially entered the Mad Max phase.“wrote Michael Thomas, founder of Clearview, a data center expansion company.
https://www.forbes.com/sites/the-prompt/2026/07/07/the-chinese-ai-blockade-is-coming/
