Former Google CEO Eric Schmidt warned that Chinese open-source AI models could dominate globally, calling it one of his “biggest fears” for the future of artificial intelligence. Speaking on the Moonshots podcast released this week, Schmidt said he worries that most countries might use Chinese AI models because they are free, while U.S. models remain closed and costly. “This produces a bizarre outcome where the biggest models in the United States are closed source and the biggest models in China are open-source,” Schmidt said. “The geopolitical issue there, of course, is that open source is free and the closed source models are not free.” He added that “the vast majority of governments and countries who don't have the kind of money that the West does will end up standardizing on Chinese models not because they're better, but because they're free.” The rise of Chinese AI systems like DeepSeek and Alibaba’s Qwen3 this year has raised concerns around data privacy, national security, and America’s competitive edge in AI. Schmidt said the open vs. closed-source divide could become a geopolitical fault line. The debate over “sovereign AI” has intensified, with Nvidia CEO Jensen Huang and Mistral CEO Arthur Mensch urging nations to develop independent systems.