Behind the Curtain: Global AI wars
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The Five Eyes intelligence alliance issued a rare joint warning this week that frontier AI capable of crippling governments and businesses is close. The fast rise of Chinese and Japanese models helps explain the urgency and fear, officials tell us.
Why it matters: Yes, Anthropic's Mythos model is the most cyber-lethal threat in the world. But OpenAI is close here in America. And China and Japan, using much cheaper models, have gotten closer, faster than intelligence agencies anticipated.
- "The timeline is not years, it is months," Five Eyes warned.
- Five Eyes, composed of the U.S., U.K., Canada, Australia and New Zealand, is considered the world's most comprehensive and powerful spy network.
The big picture: President Trump told Marc Caputo on "The Axios Show" that "we're beating China by a lot" on AI — but that lead, which U.S. leaders and businesses have been banking on, is eroding.
Three new disruptions show just how fast it's happening:
- It's becoming harder to put up a wall around America's advancements. Japan's Sakana AI launched Fugu Ultra, an orchestrator that it claims offers "frontier capability without the risk of export controls" by switching between publicly available models. The Tokyo-based company says it can reach Mythos-level performance by using U.S. labs' work as interchangeable infrastructure.
- China is eating away at that lead by stealing America's best work. In February, Anthropic accused DeepSeek, Minimax and Moonshot of illicitly training their own models via "distillation," using thousands of accounts to have millions of exchanges with Claude — a cheap shortcut to years of pricey research.
- American labs are wondering whether the frontier is worth the risk. Two weeks ago, the Commerce Department export-controlled Anthropic's Fable 5 and Mythos 5, leading the company to shut off access for everyone. The best domestic AI companies may be wary to show off their highest-capability models, fearing further government intervention.
Between the lines: China's open-source models are gaining ground fast. Z.ai's GLM-5.2 is the buzziest right now.
- An LLM leaderboard by Artificial Analysis, a benchmarking company, puts GLM-5.2 alongside OpenAI's GPT-5.5, at about a fifth of the cost to run. When it comes to coding, Arena's web development ranking has the Chinese model second only to Fable — making it the best-performing model you can actually use right now.
Alex Stamos, former Facebook chief security officer, told Axios Future of Cybersecurity that it's quite possible the Chinese "have things privately that are really, really good. [It] is arrogant and foolish of us to think that just because we're American that we've got the best stuff."
- He added that Chinese military hackers are likely "laughing hilariously right now at the Americans fighting between themselves and cutting each other off left and right."
Zoom out: It's Europe, too. Domyn — an AI company based in Milan, Italy — announced last week that its Europa project is a frontier open-source AI model that will support all 24 official languages of the European Union.
- Domyn (formerly iGenius, which was described as the Ferrari of AI) collaborated with Nvidia to build Colosseum, billed as Europe's largest AI supercomputer.
What we're watching: The Five Eyes call to action said a "whole-of-society response is required" to address accelerating cyber risk.
- "Boards and executives should ensure cyber resilience is in place and works under pressure," the bulletin says. "It is not enough to have controls. Leaders must be confident those controls will perform during a real incident. This requires reassessing long-standing trade-offs and using AI deliberately to strengthen defense — not just improve efficiency."
The bottom line: America's AI lead is real but shrinking. Every move to protect it only hands rivals another reason to route around it — all while the capabilities that have Five Eyes on edge are already loose, downloadable and impossible to recall.
- Axios' Shane Savitsky and Sam Sabin contributed reporting.
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- Go deeper: Open-source AI pits cost against security.
