'I do think we always have to think about, maybe even worry a little bit about, Chinese subsidies': Microsoft President says US firms should get ready for more competition from China

• Government-backed funding gives Chinese firms significant operational advantages
• Lower-cost AI models from China appeal to developing nations worldwide
• Microsoft is investing billions to strengthen AI tools and infrastructure globally

Microsoft President Brad Smith has warned American technology companies may face growing challenges from Chinese competitors that benefit from substantial state subsidies.

Beijing has provided multi-billion-dollar support, including a national AI fund and energy vouchers, to reduce operational costs for domestic companies.

Smith compared the situation to China’s earlier success in telecommunications, noting how state-backed firms like Huawei and ZTE disrupted the global market and pressured European and US companies.