The quiet migration of American developers toward cutting-edge Chinese AI models, specifically Zhipu AI’s GLM 4.7, signals a critical inflection point in the global technology race. This movement challenges the long-held assumption that US firms maintain an unassailable, long-term lead in foundational AI tooling and infrastructure. The sheer velocity of adoption for Zhipu’s new coding assistant—so popular that access is already being limited—is the clearest indicator yet that the geopolitical boundaries historically defining technological dominance are rapidly dissolving in the face of superior utility.
Tuhin Srivastava, CEO of Baseten, spoke with CNBC on their January 26, 2026 livestream about the sudden and unexpected demand for Zhipu AI's new coding assistant, discussing the immediate implications of Chinese open-source models penetrating the US developer ecosystem and whether the infrastructural advantage enjoyed by American tech giants is beginning to erode. The discussion centered on a live test of the GLM 4.7 model to build a China-market tracker, showcasing its surprising proficiency and speed in a domain often inaccessible or poorly handled by Western models. The core takeaway for the audience of founders and investors was stark: performance, not patriotism, dictates developer choice.
Srivastava noted that the adoption is purely "a function of utility; if a tool solves a problem better, cheaper, and faster, developers will use it, irrespective of the flag on the server." This insight cuts directly to the heart of the competitive landscape. For years, the narrative held that while China might catch up in application layers, the foundational models and the underlying infrastructure—the massive, proprietary data sets, the access to cutting-edge US-made chips, and the integrated cloud ecosystems—provided an insurmountable moat for companies like OpenAI, Google, and Anthropic. Zhipu AI’s success, particularly in the highly technical domain of code generation, suggests that this moat is not just being tested, but is actively being bypassed.
The geopolitical risk inherent in this shift is substantial, yet the market is demonstrating a clear preference for efficiency. American builders are quietly—or perhaps loudly, given the access limitations—moving to these Chinese models because they deliver superior results for specific tasks, especially those related to Asian markets or highly optimized backend tasks. The fact that a Chinese firm, backed by significant state-aligned capital, can achieve such immediate global traction underscores a fundamental failure in competitive strategy by US incumbents. They may have underestimated how quickly model quality, especially in a specialized, high-leverage area like coding, could override concerns about data sovereignty or potential future political instability.
The Baseten CEO highlighted that this isn't merely about Zhipu having a good model; it’s about the entire deployment and accessibility layer. The ease with which these models can be integrated, often through open-source or permissive licensing structures, creates a powerful gravitational pull. When a developer can drop in a highly effective, low-latency coding assistant that significantly accelerates their product roadmap, the origin of that tool becomes a secondary compliance headache rather than a primary blocker. This reality should alarm US defense and intelligence analysts as much as it concerns venture capitalists who have staked billions on the idea of American technological exceptionalism.
Srivastava emphasized that the competitive dynamic has moved beyond just the quality of the model weights. The speed at which Zhipu went from a domestic player to a global contender shows that the infrastructure moat is "far shallower than we previously calculated." This is a crucial distinction. The infrastructure, in this context, refers not just to hardware, but to the ecosystem of distribution, developer relations, and the seamless integration into existing workflows. If Chinese firms can rapidly build parallel, high-quality ecosystems that cater directly to developer needs globally, the long-term advantage held by AWS, Azure, and GCP in providing the foundational environment for AI development comes under severe pressure.
The demonstration of GLM 4.7’s capability in generating code for a China-market tracker served as a powerful, tangible proof point. It showed that for tasks requiring nuanced linguistic understanding, regional data awareness, or specific API integrations relevant to non-Western platforms, these models possess a native advantage. This forces US companies to either rapidly acquire that regional expertise—a costly and slow process—or risk ceding massive segments of the global developer market to competitors who are already optimized for non-Western realities. For founders, the immediate implication is a strategic re-evaluation of their AI supply chain, balancing the clear performance gains of tools like GLM 4.7 against the potential regulatory and security risks of relying on technology originating from a strategic competitor. The market is currently voting for performance, and that vote is shifting the global balance of power faster than policymakers can react.
