Baidu denies Chinese military link after report sent stock tumbling

By Steve Goldstein

Baidu on Monday said it had no links to a Chinese military lab, after a report sent stock in the internet services company tumbling.

Baidu shares (HK:9888) in Hong Kong slumped 12% after the South China Morning Post reported on a research laboratory with the People's Liberation Army's Strategic Support Force that had tested its AI system on Baidu's Ernie, as well as iFlyTrek's Spark, which are large language models akin to OpenAI's ChatGPT.

U.S. shares of Baidu (BIDU) were not trading on Monday, as U.S. stock markets are shut in observance of the Martin Luther King Jr. holiday.

"The academic paper, published by scholars at a Chinese university, described how the authors built prompts and received responses from LLMs, using the functions available to any user interacting with generative AI tools. Baidu has not engaged in any business collaboration or provided any tailored service to authors of the academic paper or any institutions with which they are affiliated," said the statement from Baidu, which also noted that The South China Morning Post corrected its initial report.

The correction states that the PLA lab tested its system on the Baidu model, but corrected its initial reporting that there was a physical link between its AI system and Baidu's Ernie.

The newspaper reported that the academic paper said the AI simulated the U.S. invasion of Libya in 2011, and successfully predicted the next move of the U.S. military.

-Steve Goldstein

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01-15-24 0732ET

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