Microsoft’s Xiaoice chatbot to become its own company in China

When internet users in China are looking to chat with AI just for fun, they’re unlikely to turn to popular voice assistants like Apple’s Siri or Xiaomi’s Xiao AI. Instead, China’s “fun” AI of choice actually comes from Microsoft, and it will soon be an independent company.

Xiaoice is a sassy, Mandarin-speaking chatbot that Microsoft created in 2014. Since then, it’s become a hit in China. Xiaoice now boasts 660 million global users with a reach of 450 million smart devices. Many men in China have even dubbed Xiaoice their “virtual girlfriend.”

Microsoft recently announced plans to spin off Xiaoice into an independent company. The reason, according to Microsoft, is to “accelerate the Xiaoice product line’s localised innovation, and to improve Xiaoice’s commercial ecosystem.”

The process will be completed in the next few months, the company added. Chinese news site Caixin reported that the Covid-19 pandemic and tensions between the US and China sped up the spin-off process.

Unlike voice assistants designed to help users by performing specific tasks, Xiaoice is meant to be more of an emotional companion with higher emotional intelligence than other conversational AI bots.

Over the years, it’s proven to be better than other chatbots at making conversation with cheeky, playful and sometimes flirtatious responses. In an episode of the popular Chinese podcast Story FM last week, a Chinese man said Xiaoice saved his life when he was contemplating suicide in 2018 after a break-up.

Xiaoice’s creative and snarky comments have also landed the chatbot in trouble. In 2017, Xiaoice was pulled from Tencent’s messaging app QQ after she said her “Chinese dream” – a term coined by President Xi Jinping – was to “go to America.” Xiaoice was also pulled from Tencent’s WeChat last year for unspecified reasons, and it remains unavailable on the widely used messaging app.

Xiaoice does more than just provide emotional support. It’s also trained to write poems, paint and compose music. A theme song for this year’s World Artificial Intelligence Conference in Shanghai, for instance, was created by Xiaoice, reportedly taking two minutes. It was also one of the four virtual singers that performed the song.

Xiaoice can also be used to generate financial news briefings, a service that was reportedly used by more than 90 per cent of traders at financial institutions in China in 2018. Now in its seventh generation, Xiaoice even lets companies create and train tailor-made versions of the bot using its AI system Avatar Framework.

Xiaoice is currently available in three countries. While it started in China, it also spread to Indonesia and Japan, where it’s known as Rinna, according to Microsoft. The chatbot was discontinued in India and the US last year.