Author | Liu BaodanEditor | Zhou ZhiyuFor many years, the C-end traffic entrance has been almost dominated by WeChat and Douyin. Although Alibaba has envied this, it has never been able to create a killer social product. Now, with the arrival of the AI era, Alibaba is rekindling its ambitions for the C-end.On March 13, Alibaba announced the launch of its AI flagship application - New Quark, which will bid farewell to traditional search and upgrade to an All-in-One &#34;AI Super Box&#34; to meet all user needs. Eddie Wu, Vice President of Alibaba Group and CEO of Quark, firmly believes that a new AI super application will emerge in the near future.This means that Alibaba has officially elevated the C-end AI killer application to a strategic height. A day earlier, Joseph Tsai, Chairman of Alibaba Group, stated at a forum held in Singapore that the potential market size for artificial intelligence is at least $10 trillion, and it could be even larger, surpassing industries such as transportation and health insurance.The challenges are also evident. AI technology is still accelerating its iteration, which brings uncertainty. Moreover, in terms of product development capabilities, Alibaba not only faces strong competitors like Tencent and ByteDance but also many startups betting on the AI era, all of which will put pressure on Alibaba.Compared to the mobile internet, the super traffic entrance in the AI era will have a more oligopolistic effect and will be a battleground for tech companies. Can Alibaba win this time?<h2>Ambition</h2>After making small moves in the C-end market, Alibaba has finally made a big move.Wall Street Insight has learned from internal sources that Alibaba positions the &#34;AI Super Box&#34; as a tool that can meet various AI needs for users' work, study, and life. After users input commands into the &#34;AI Super Box,&#34; Quark will automatically recognize the intent, plan and organize, and activate various models and Agent modules to help users complete tasks.Unlike the mainstream AI product form of Chatbot in the market, Quark hopes to go further by integrating AI dialogue, deep thinking, deep search, deep research, and deep execution into a minimalist &#34;AI Super Box&#34; to meet all user needs.This is the first time Alibaba has articulated such a clear goal for its C-end application. To a large extent, all needs also represent the ideal form of super applications in the AI era, highlighting Alibaba's grand ambitions in AI.Eddie Wu, Vice President of Alibaba Group and CEO of Quark, stated: &#34;This upgraded version is just a prototype of the new Quark. With the continuous iteration and upgrade of model capabilities in the future, we hope that the Quark AI Super Box can be like Doraemon's pocket, allowing users to enter the AI world here.&#34;Within its vast business ecosystem, Alibaba's choice of Quark as the entry point for C-end super applications has long been traceable.Over the past two years, Alibaba has been in a state of structural disassembly and strategic adjustment, gradually determining a development approach of &#34;user-first, AI-driven.&#34; By the end of 2023, Eddie Wu will position Quark as one of the first strategic-level innovative enterprises. In his view, in the era of large models, targeting students and young people, Quark has a huge opportunity to create innovative search products.At the beginning of this year, Quark launched a series of intensive adjustments. Wall Street Insight has learned that Alibaba's &#34;young faction&#34; executive Eddie Wu will focus on exploring Alibaba's AI To C-end application business, indicating that AI To C's strategic position within Alibaba is becoming increasingly prominentAlibaba has also handed over the smart interconnection business group, where the To C hardware business &#34;Tmall Genie&#34; resides, to Wu Jia, the president of the intelligent information business group, for overall management. Wall Street News has learned that the team's focus is on the planning and definition of the next generation of AI products, as well as the integration with Quark's AI capabilities.In mid-January, Alibaba spun off the AI application &#34;Tongyi&#34; from Alibaba Cloud and incorporated it into the Alibaba Intelligent Information Business Group, where Quark is located. At the same time, Quark changed its brand slogan to &#34;AI all-round assistant for 200 million people.&#34;In early February, Wall Street News learned that AI scientist Xu Zhuhong officially joined Alibaba as Vice President of Alibaba Group, responsible for multimodal foundational models and Agents related basic research and application solutions for AI To C business. This is the first time Alibaba has disclosed its recruitment of top talent for C-end business, and the significance behind it is self-evident.Not long after, the Quark App and PC version underwent a comprehensive upgrade, with the homepage welcoming an AI refresh. Quark AI search launched &#34;Deep Thinking,&#34; which not only provides answers but also analyzes, thinks, and creates plans. Alibaba's intention to use Quark as an entry point for C-end traffic has become very clear.Now, all actions have specific directions, and Quark, as Alibaba's C-end weapon for the AI era, is about to enter a new stage of development.<h2>Temptation</h2>Behind Quark's strategic upgrade, the AI market is accelerating towards application landing, and Alibaba's AI investment has become clearer in direction.On February 20, during the Q3 fiscal year 2025 earnings analyst conference call, Eddie Wu stated that in the next three years, Alibaba will increase investment around AI as the strategic core, focusing on three areas: AI infrastructure, foundational model platforms, and AI-native applications, as well as the AI transformation of existing businesses.In addition to investing over 380 billion yuan in building cloud and AI hardware infrastructure, Alibaba's AI strategy also emphasizes AI-native applications. In Alibaba's view, foundational AI models are of great significance for transforming industry productivity, and they will significantly increase R&amp;D investment in foundational AI models and promote the development of AI-native applications.Now, Quark has become the most important carrier for Alibaba to promote AI-native applications. In fact, as the largest e-commerce platform, Alibaba has always had traffic anxiety, which can be seen from the overwhelming traffic investment during the annual 618 and 11.11 promotions. Having a super traffic entry point in the AI era is extremely tempting for Alibaba.Billionaire private equity mogul Ba Dan last month stated that the application side of AI may explode in 2025. In recent years, there has been significant market value growth in hardware, but growth on the software and application side has been limited. In 2025, industries and companies on the software and application side may achieve breakthroughs. &#34;This year, we may shift from hardware to focus more on companies with business models on the software and application side.&#34;Alibaba has chosen to place the strategic burden of AI To C on Quark, which has been established for eight years, because of the unique advantages Quark has accumulated over time, namely the capture of young users' mindsets and the accumulation of scenario-based technology.Wall Street News has learned from internal sources that by the end of last year, the Tongyi and Quark teams were still at the same level, but Quark continued to attract young users without large-scale traffic investment. According to data released by Analysys in January, Quark's young user (under 24 years old) proportion exceeds 50%The aforementioned individuals stated that although Quark is not the latest AIGC application, as an intelligent search browser, it possesses language interaction characteristics and has obvious tool attributes. Quark can answer questions and perform tasks in various scenarios such as AI search, AI writing, AI image generation, AI question answering, AI health inquiries, and travel planning.On March 13, Wu Jia expressed in his social circle that the thinking behind the new Quark is that the AI era is roaring in, and the way humans acquire information and complete tasks in learning, work, and life will undergo tremendous changes. He hopes that Quark can use an AI super box to open the door for users to enter the AI world.&#34;In the past, people used search; in the future, AI will use search.&#34; In his view, humans will no longer need to directly use tools like search but will give complete task instructions directly to AI. AI will think, execute, and interactively adjust during the process to complete the final task delivery.&#34;We firmly believe that this will all be realized in the near future, giving birth to new AI super applications,&#34; Wu Jia said excitedly.<h2>Competition</h2>Creating killer applications for the AI era has become the main battlefield for tech giants and startups vying for the future.Currently, Quark has begun to emerge. The latest AI application ranking released by AIGCRank for January 2025 shows that Quark has 33.69 million daily active users, firmly holding the top position among various AI applications. However, in the list regularly published by QuestMobile, Quark was not included in the AI native app ranking.Looking at global AIGC applications, Quark still has a long way to catch up. On March 7, the well-known venture capital firm A16Z released the ranking of the top 100 generative AI applications globally for 2025. In the mobile version ranking, Quark AI is ranked 6th, while it did not make the list in the web version.Overall, the current stage of AI applications is still in a state of homogenization, with limited intelligence levels. Chen Shi, founder of Peakview Capital, stated at the end of last year that comparing leading AI applications with leading applications from the mobile internet era, the user activity metrics of the former are far inferior to the latter, which is not an ideal situation.Regarding the specific reasons, Chen Shi indicated that the main issue is still the insufficient model capabilities, which prevent AI applications from differentiating themselves from traditional applications. &#34;If we can have new models that unlock more powerful capabilities, it may be possible to create applications that far exceed the current experience, and there might be an opportunity to bypass the growth trap.&#34;Quark's confidence comes from its backing by Alibaba. Wall Street News learned that the new Quark will continuously develop based on Alibaba's Tongyi leading reasoning and multimodal large models, and the latest achievements of the Tongyi series models will be integrated into Quark as soon as possible.Recently, Alibaba has been continuously strengthening its efforts in foundational models and native applications, successively releasing globally leading open-source models such as Qwen2.5-VL, Qwen2.5-Max, Tongyi Wanxiang 2.1, and Qianwen QWQ-32B, especially Qianwen QWQ-32B, which has overall performance comparable to DeepSeek-R1, with deployment costs only 1/10 of R1However, AI large model technology is still rapidly iterating, and the market is driven by model performance rather than products. This also means that Alibaba must continue to iterate on technology and make forward-looking judgments on AI technology directions.Alibaba's real challenge lies in the fact that, although the company has capabilities in the AI industry chain and ecological advantages, and excels in B-end business, it lacks experience in creating C-end products. In 2013, Alibaba attempted to create a social application called &#34;Laiwang&#34; to compete with WeChat, but ultimately failed. Alibaba then shifted its focus to DingTalk, targeting the enterprise market.Industry insiders believe that the risk Alibaba needs to be wary of is that Quark is trying to position itself as a toolbox, but this could also lead to bloated product functions, resulting in a lack of highlights and making its core competitiveness vague. In fact, many office software products have made this mistake.AI has become a must-win battle for global tech giants, with Tencent and ByteDance, which excel in C-end products, also making strides, which will create competitive pressure for Alibaba.Since the beginning of the year, Tencent's first AI-native app, Yuanbao, has emerged as a dark horse, first integrating DeepSeek-R1 and pouring in significant traffic, followed by continuously adding product features. On February 22, Yuanbao rose to second place in the Apple free app download rankings in China.ByteDance has also laid out multiple segments in AI assistants, video generation, and other areas, with its main product Doubao being the fastest-growing AIGC application over the past year. Wall Street Journal learned that in early March, ByteDance was testing different experimental versions of the deep thinking model in a small range within Doubao. Meanwhile, the Douyin search app recently launched the &#34;deep thinking model.&#34;Another force that cannot be underestimated is startups. In fact, whether it is DeepSeek or Manus, the companies leading AI development are these highly innovative firms, which are more sensitive to demand, flexible in their approach, and pose a certain threat to Alibaba's efforts in the C-end market.Over the past decade, Tencent and ByteDance have rapidly risen on the wave of the mobile internet era, solidifying or advancing as tech giants. Now, with the AI era roaring in, Alibaba, starting anew with an entrepreneurial mindset, sees an opportunity. This time, can Alibaba achieve its wishes?

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The competition for traffic entry in the AI era

- Alibaba has launched its AI flagship application, New Quark, aiming to transform traditional search into an all-in-one "AI super box" to meet diverse user needs.  
- The company is strategically positioning Quark as a key player in the consumer AI market, with significant investments planned in AI infrastructure and applications over the next three years.  
- However, Alibaba faces intense competition from established tech giants and startups, raising questions about its ability to succeed in the rapidly evolving AI landscape.

Alibaba launches an attack on AI super applications