Alibaba Releases Free AI Video Model, Stock Jumps 5%

Chinese e-commerce giant Alibaba has made its video- and image-generating artificial intelligence model, Wan 2.1, publicly available.

The move is expected to increase adoption and intensify competition in the AI space, particularly against established players like OpenAI, as noted by The Economic Times (ET).

Alibaba announced on Wednesday that it has released four variants of Wan 2.1—T2V-1.3B, T2V-14B, I2V-14B-720P, and I2V-14B-480P. These models, which generate visuals from text and image inputs, are accessible via Alibaba Cloud’s ModelScope and Hugging Face platforms, says ET.

The “14B” in some versions refers to the model’s capacity to process 14 billion parameters, allowing for more detailed and accurate outputs. The company had introduced the latest version of its AI model in January, initially named Wanx before being rebranded as Wan, as noted by ET.

It claims Wan 2.1 excels in generating highly realistic visuals and has secured the top ranking on VBench, a leaderboard for video-generative models. The model is particularly noted for its ability to depict multi-object interactions.

Reuters notes that Alibaba’s decision follows a similar move by Chinese AI startup DeepSeek, which earlier this year released open-source models that gained attention for their strong performance at a lower cost.

DeepSeek’s success surprised industry observers, as AI development is typically capital-intensive. Like DeepSeek’s models, Wan 2.1 can be downloaded and modified by users, setting it apart from proprietary AI systems such as OpenAI’s.

CNBC argues that the release of Wan 2.1 contributes to an ongoing debate about whether AI models will become commoditized. Open-source AI allows developers to refine and build upon existing models, fostering innovation and community engagement.

However, such models do not generate direct revenue, unlike proprietary systems. Despite this, Alibaba has been at the forefront of China’s push toward open-source AI, having launched its first publicly available model in August 2023, as reported by CNBC.

The announcement has had a positive effect on Alibaba’s market performance. Its Hong Kong-listed shares closed nearly 5% higher on Wednesday, as reported by CNBC.

The company’s stock has surged 66% in 2025 so far, benefiting from improved financial results and growing recognition as a key AI player in China. Government support for the private sector under President Xi Jinping has further bolstered investor confidence.

In addition to its AI initiatives, Alibaba unveiled plans this week to invest at least 380 billion yuan ($52 billion) over the next three years to strengthen its cloud computing and AI infrastructure, as observed by Reuters.

In conclusion, Alibaba’s open-source AI push strengthens its position in the industry, fueling competition and innovation.