Good morning, AI enthusiasts. Chinese president Xi Jinping just hit the accelerator on a “national system” to build home-grown chips, software, and AI talent — with no U.S. supply chain required.

With rumors of breakthrough domestic chips and a potential second 'DeepSeek moment' approaching, the U.S. lead in the AI race may be tighter than ever.

In today’s AI rundown:

• Xi pushes for China’s AI self-reliance

• Anthropic CEO calls for AI interpretability

• Create specialized legal assistants with Grok

• Baidu debuts new Ernie AI, targets DeepSeek

• 4 new AI tools & 4 job opportunities

LATEST DEVELOPMENTS

CHINA & AI

🇨🇳 Xi pushes for China’s AI self-reliance

Image source: Reve / The Rundown

The Rundown: Chinese President Xi Jinping just declared AI self-sufficiency as a national priority, promising government support to boost the development of AI chips, software, and talent, amid escalating tech rivalry with the U.S.

The details:

• Xi outlined a "new whole national system" approach, aiming to develop high-end chips and software while increasing AI education and talent development.

• The initiative includes expanded government policy support, IP protection, and research funding to overcome tech bottlenecks.

• Chinese chipmaker Huawei is reportedly testing a new advanced chip to offer a domestic alternative to NVIDIA processors, currently restricted by the U.S.

• Rumors have also spread about the upcoming release of DeepSeek R2, with price and training cost cuts, and the use of Huawei chips over NVIDIA.

Why it matters: Between a potential second ‘DeepSeek moment’ around the corner, domestic AI chip alternatives making U.S. export controls ineffective, and a quickly closing gap in models, China is putting its foot on the gas with a country-wide effort to grab hold of the AI lead — while proving it doesn’t need U.S. chips to succeed.

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• Conduct hours of deep research in seconds across every app

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• Enterprise-grade security and zero data leakage

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ANTHROPIC

🔬 Anthropic CEO calls for AI interpretability

Image source: GPT-4o / The Rundown

The Rundown: Anthropic CEO Dario Amodei published a new blog highlighting the critical need for "mechanistic interpretability" in AI, arguing that understanding models’ inner workings could become humanity’s safeguard as they grow increasingly powerful.

The details:

• Amodei stressed that AI is different from traditional software because decision-making emerges organically, making its operations unclear even to creators.

• He revealed that Anthropic has mapped over 30M "features" in Claude 3 Sonnet, representing specific concepts the model can understand and process.

• The CEO compared the ultimate goal to creating a reliable “AI MRI” for diagnosing models and better understanding their “black box”.

• He said AI is advancing faster than interpretability, leaving us unprepared for AI systems like a “country of geniuses in a datacenter,” coming as early as 2026.

Why it matters: Anthropic has been leading the charge on AI safety, and Amodei’s essay frames understanding models’ inner workings as not just a technical challenge but a prerequisite for safely deploying their advanced versions. The question is if the other frontier labs will be as patient — and so far the answer has been no.

AI TRAINING

🧑‍⚖️ Create specialized legal assistants with Grok

The Rundown: In this tutorial, you will learn how to use Grok's new Workspaces feature to create dedicated AI assistants for specific tasks, like reviewing contracts and legal documents, with document upload capabilities.

Step-by-step:

1. Visit Grok and click "New Workspace" in the sidebar to create a fresh workspace for legal document review.

2. Set up detailed instructions by clicking the "Instruction" button, telling Grok exactly how to analyze your legal documents.

3. Upload your contracts and legal documents using the "Attach" button for Grok to reference throughout your conversations*

4. Analyze your documents using the "DeepSearch" option for internet research and the "Think" button for deeper document analysis.

*Note: Before uploading any sensitive legal documents, make sure to redact or hide any confidential information you don't want to share. Also, AI might hallucinate, so always double-check its answers.

PRESENTED BY SALESFORCE

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The Rundown: Dreamforce 2025 — the world’s largest, most trusted AI event — returns on Oct. 14 with three days of next-level innovation and real-world inspiration you can bring back to your business.

Here’s what you’ll experience:

• AI agent building alongside product experts with Salesforce’s Agentforce

• 50+ visionary and product keynotes

• 1,200+ breakout sessions across every product, role, and industry

• 150+ hands-on trainings and 240+ peer roundtables

Join the list and get early access.

BAIDU

🤖 Baidu debuts new Ernie AI, targets DeepSeek

Image source: Baidu

The Rundown: Baidu just unveiled two upgraded, lower-cost ERNIE AI models and new tools at its Create 2025 event — and publicly took aim at rival DeepSeek during the conference.

The details:

• ERNIE 4.5 Turbo costs just 11c / million input tokens, an 80% price reduction from its predecessor and operating at 0.2% of GPT-4.5's cost.

• The ERNIE X1 Turbo reasoning model is priced at 14c / million input tokens — reportedly 75% cheaper than competitor DeepSeek R1.

• 4.5 Turbo brings new multimodal capabilities that surpass GPT-4o on benchmarks, with X1 Turbo topping Deepseek’s R1 and V3.

• Baidu also announced Xinxiang, a multi-agent system that can handle over 200 different tasks, and a new digital avatar platform called Huiboxing.

• Baidu founder Robin Li said the “market is shrinking” for text-based models like DeepSeek’s R1, saying the rival also had a higher rate of hallucinations.

Why it matters: Chinese AI labs continue to push costs down while claiming competitive performance to top models, putting the pressure on rivals, both domestic and in the West, to cut prices and continue shipping. Recent estimates suggest China is just three months behind on AI, a number that is shrinking with each release.

QUICK HITS

🛠️ Trending AI Tools

• 🎙️ Retellio - AI Agent that transforms customer call recordings into concise, AI-curated podcasts, highlighting key insights for business leaders*

• 🎇 Firefly 4 and 4 Ultra - Adobe’s new upgraded text-to-image models

• 🎹 Music AI Sandbox - Google’s new AI tools for creating and editing music

• 🗣️ Hummingbird-0 - Tavus’ new SOTA lip-sync video model

*Sponsored Listing

💼 AI Job Opportunities

• 🧵 Figure AI - Softgoods Developer

• 🛠️ Shield AI - Prototype Technician

• 💸 Palantir Technologies - Financial Analyst

• 📊 Databricks - Product Designer

📰 Everything else in AI today

OpenAI released an updated version of its GPT-4o model, with better memory saving, problem solving, and improvements to both intelligence and personality.

Elon Musk revealed that X’s social media feed will be getting an algorithm update powered by xAI’s Grok AI model.

Liquid Sciences dropped Hyena Edge, a hybrid AI with a “convolution” architecture that provides faster processing and improved benchmarks on mobile devices.

OpenAI introduced a new lightweight version of deep research, powered by o4-mini, to expand usage limits, saying it’s “nearly as intelligent” and much cheaper to serve.

Digital publisher Ziff Davis filed a lawsuit against OpenAI, alleging the company stole content from its properties (like Mashable, PCMag, and IGN) to train models.

Moonshot AI launched Kimi-Audio, a new open-source, SOTA audio model that excels in speech recognition, audio-to-text, and speech-to-speech conversations.

COMMUNITY

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Join our next workshop today at 3 PM EST with Ellie Jacobs and Noam Markose from LTX Studio. In this live session, you’ll learn how to bring your AI-generated storyboards to life using LTX Studio’s powerful new timeline editor — no editing experience needed.

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See you soon,

Rowan, Joey, Zach, Alvaro, and Jason—The Rundown’s editorial team