Breakthroughs in cheap Chinese open-weight artificial intelligence models have spooked US investors, but analysts argue plummeting model costs will benefit the AI industry in the long run by supercharging global demand for AI systems. Under pressure from cheaper Chinese models, Silicon Valley firms have cut the prices of closed models in an effort to grab market share. But analysts say the intense competition will benefit the AI industry in the long run. The booth of Chinese AI model company MiniMax seen at the World AI Conference in Shanghai on July 17, 2026. “This is good for consumer and enterprise users of AI (agents) and promotes much wider and faster AI adoption.”