News: 0184400894

  ARM Give a man a fire and he's warm for a day, but set fire to him and he's warm for the rest of his life (Terry Pratchett, Jingo)

China's AI Companies May Be 'Distilling' America's AI Models (yahoo.com)

(Saturday July 11, 2026 @05:47PM (EditorDavid) from the model-behavior dept.)


In March, Anthropic's Claude "quietly deployed software to spy on China-based customers," [1]reports the Washington Post — apparently to unmask Chinese rivals "suspected of hijacking its technology to make their own AI tools smarter." Last week Anthropic removed the spyware "after a software developer revealed its existence and privacy advocates criticized Anthropic, saying it had surveilled its own users."

> Anthropic's tracking code was designed in part to catch Chinese firms "distilling" its AI models, a technique that involves pressing a large, expensive AI system to serve as a tutor to a smaller, cheaper one. Asking the larger system huge numbers of questions — hundreds of thousands or more — generates responses that can be used to upgrade the power of the smaller one on the cheap. Distillation isn't illegal, and it has been used for years in the AI industry. But distillation without permission is against AI companies' rules, and, used effectively, is giving Chinese AI companies a major leg up, American AI companies say... Anthropic and ChatGPT-maker OpenAI have both accused Chinese AI companies of using this technique to build copycat AI models of their own.

>

> In [2]a May blog post , Anthropic said that Chinese companies' use of distillation, along with evading U.S. export controls on high-end computer chips, has allowed them to "trail closely" behind U.S. models. But if these techniques can be blocked, it might be possible for the United States to "lock in a 12-24 month lead" on Chinese capabilities, the company said... This month, Anthropic said in a letter to U.S. senators that was obtained by The Post that it uncovered a campaign in which Chinese tech giant Alibaba's Qwen AI team used roughly 25,000 fraudulent accounts to generate more than 28.8 million exchanges with Claude to improve its own technology. In February, Anthropic made similar accusations against the Chinese firms Deepseek, Moonshot and MiniMax and said the campaigns were "growing in intensity and sophistication...." Anthropic and OpenAI have appealed to the U.S. government, arguing that distillation amounts to intellectual property theft that harms the U.S. in the geopolitical AI contest....

>

> That Chinese AI labs are using U.S. models to improve their own technology appears beyond dispute. In a February 2025 study, researchers from China's Peking University and the state-funded Chinese Academy of Sciences developed methods to detect signs of distillation in leading large language models. They concluded that, with the exception of ByteDance's Doubao, most domestic models they tested showed substantial evidence of distillation, mostly drawing from U.S. models... In one set of intensive tests, a Qwen model misidentified itself as Claude nearly a third of the time, the Chinese researchers found.

>

> U.S. firms have also used distillation to piggyback on AI systems made by others. In 2024, OpenAI released a tool to make it easier for customers to distill its own models and produce data sets for AI training. SpaceX founder Elon Musk said in court testimony in May that his AI company xAI used distillation to train its models and that the technique is common throughout the industry.

The article also notes that Anthropic "said it has banned nearly 700,000 accounts that were using Claude in China." But the article includes this quote from Kyle Chan, a fellow at the Washington-based Brookings Institution's China Center. "Anthropic's framing is that this is a geopolitical contest for basically the future of the world and freedom and democracy. It's that this is not just undercutting the U.S. commercially, but undercutting American strategic advantage in the most powerful technology we know today."



[1] https://www.yahoo.com/news/politics/articles/the-covert-us-china-battle-to-make-chatbots-leak-their-secrets-090000095.html

[2] https://www.anthropic.com/research/2028-ai-leadership



And? (Score:5, Insightful)

by OverlordQ ( 264228 )

American AI companies 'distilled' millions of works from the original authors, they dont like it? Tough.

I don't care where things are made anymore (Score:4, Insightful)

by rsilvergun ( 571051 )

Everything is automated so we don't get any job creation and all the money just goes up to the top anyway. What the fuck do I care if it's a Chinese billionaire getting all the money or an American billionaire and getting all the money?

It's 2026 is there anyone naive enough to believe that there's some magical world where jobs come back? Half of people under 30 are living with their parents and no it's not because of cell phones and avocado toast...

Re: (Score:2)

by serviscope_minor ( 664417 )

Well quite. Either making an AI by copying something is copying in which case they're a bunch of criminals ready to go to prison for a thousand years according to how it works for peons, or it's not in which case the Chinese are also doing nothing wrong.

They want it both ways,

Utter fuckers.

And? (Score:4, Insightful)

by liqu1d ( 4349325 )

The American companies distilled everyone else's stuff without asking. Difference is anthropic actually got paid by the Chinese.

Re: (Score:2)

by allo ( 1728082 )

And Anthropic created content that is not copyrighted and cries foul when someone uses it like it were not copyrighted. It is even unclear if they could really ban you for that, but of course they can ban using their "... or without a reason" clauses.

China and everyone else (Score:2)

by ceoyoyo ( 59147 )

You make a question answering web service and then people pay you to have it answer their questions. How unfair. Oh the humanity.

Re: (Score:1)

by Anonymous Coward

The llms aren't a 'question answering service'. They are a pattern-matching and string generating service.

These systems cannot 'answer questions' because they don't understand them.

A simple test: ask the same question in a positive and a negative tone and watch the "answering service" generate two completely different answers, simply because the generator is producing output based on different matches.

Anthropic is using... (Score:4, Insightful)

by MpVpRb ( 1423381 )

...every dirty trick in the book to secure their monopoly.

They spread fear and claim that only they can ensure safety.

They refuse to release a powerful model, claiming it's too dangerous.

They invite government restrictions.

They attack open source projects.

Classic monopolist behavior.

Re: Anthropic is using... (Score:2)

by LindleyF ( 9395567 )

It helps that their models are widely regarded as the best.

Re: (Score:2)

by ArchieBunker ( 132337 )

It depends on what you’re doing. Claude is the best for generating code.

Monopoly is inevitable (Score:3)

by rsilvergun ( 571051 )

The Bonanza of free training data is over and done with. Sites are locking down and blocking scraping bots. They have to or they get overwhelmed by the cost of the traffic.

That means only the big platform holders are going to be able to keep their models fed and current.

So facebook, microsoft, maybe Apple and that's about it. In the past I would include Twitter but I think it's mostly politics bots and pussy pics in bio posts.

AI is a technology that by its very nature becomes a monopoly.

Re: (Score:2)

by bussdriver ( 620565 )

Do they retain all their training data? can they store all that? - i thought they were using all the internet and massive piracy?

The web is being polluted with slop so.... I would think China could get around all copy-protection and have an advantage in data collection outside of the slop invested parts of the web. If the USA AI corps were not violating the law, they'd be trying to scrape from China's bots who don't have their legal limitations... Is the old web even that valuable to mine in the 1st plac

Re: (Score:2)

by Mr. Dollar Ton ( 5495648 )

You assume that there is value in "keeping your models current", which is a questionable proposition.

I have a couple of (rather simple) systems that successfully use "non-current" models that access a database with current data as needed.

The setup works quite well for code generation that must conform to APIs that the original model has never seen - in fact, not much worse than the most "frontier" among the "frontier models".

Re: (Score:2)

by AmiMoJo ( 196126 )

And as usual they claim that China is only capable of stealing and copying. It's always the same mistake, and the same outcome.

Re: (Score:2)

by allo ( 1728082 )

Synthetic data contains too many model names to prevent that from happening. Even without direct distilling you can bet that they incorporate every dataset they can find in the different repositories. And many of that are distilled from a wealth of different models. Anthropic would be stupid if they wouldn't do that themselves as well.

Completely normal and expected. (Score:2)

by Kernel Kurtz ( 182424 )

More knowledgeable entities passing that knowledge on to less knowledgeable entities is kind of how the entirety of human civilization was built. Reality is not going to change now just because AI companies don't like it.

I understand! (Score:3)

by Baron_Yam ( 643147 )

Theft of IP is only OK when large American companies do it.

When I was young, I thought people blathering on about class war were propagandized idiots. Turns out I was the propagandized one.

People generally act based on their own selfish interests, and the rich want to be richer. They can buy policy, we can't. They are insulated from us by their wealth and we don't matter. We have no rights, we're not people because we're not rich. They can steal from us but can then wield the power of the government to prevent others from stealing from them in turn.

They don't need to form an army and march on us, they act based on their individual interests that happen to align with those of other rich people most of the time - and sometimes they do actually conspire against us.

Oh No! (Score:2)

by Local ID10T ( 790134 )

Anyway. Spies gonna spy. Counterintelligence gonna spy on the spies. (Yo dawg...) If you don't like it get out of the game.

These companies are constantly one-upping each other. Tight competition means they are trying anything for an edge.

Let 'em play, ref!

Does a bear d something in the woods? (Score:2)

by shanen ( 462549 )

Yeah, same joke but AIs don't call for original humor. Still, I sadly thought the story had more potential for funny.

Fixed that for you (Score:2)

by oumuamua ( 6173784 )

Anthropic's framing is that this is a geopolitical contest for basically the future of the world and freedom and democracy.

Anthropic's framing is that this is a geopolitical contest for basically the future of the world and freedom and democracy; assuming in Nov Trump is voted out and Democratic Socialist voted in.

Stupidity is its own reward.