National pride aside, we must decide if competition is good or is it bad. In the west we've been conditioned that competition is good and expect consequences and tradeoffs. In this case we're seeing incumbents trying to lobby government to secure their market share.
People rightfully question if these business models were ever feasible or sustainable to begin with. But isn't that the risk they took? We can certainly recognize that being displaced before realizing profit from your work is like a kick in the pants, but isn't that always supposed to be a possible outcome? I realize that is part of why we have intellectual property rights to reward innovators - but that isn't a universal concept in this global economy.
Which, some might argue, may be the point on the global stage. It is an ideological competition as well.
As with many others among these threads I don't see how the timing works out for K3 to have trained on distilled Fable usage. There should be at least a tacit academic acknowledgment of Kimi's own design efforts.
Distillation itself, however, is still clearly valuable - else competitors wouldn't pay so much to their rival on distillation campaigns or try to circumvent anti-distillation defenses.
As for the morality of it, if you paid for the tokens they're yours. It is already understood that you own the output. Seems to me like a variation of ordinary business arbitrage. Providers might object to certain use-cases or intention and try to craft terms around that, but that's hard to enforce at scale.
There's this https://github.com/code-yeongyu/oh-my-openagent which implements the OP article's oracle pattern across 11 roles. Each role has a whole ranking of recommended LLMs across many providers. For example "Sisyphus (claude-opus-4-8 / kimi-k3 / glm-5 ) is your main orchestrator."
People rightfully question if these business models were ever feasible or sustainable to begin with. But isn't that the risk they took? We can certainly recognize that being displaced before realizing profit from your work is like a kick in the pants, but isn't that always supposed to be a possible outcome? I realize that is part of why we have intellectual property rights to reward innovators - but that isn't a universal concept in this global economy.
Which, some might argue, may be the point on the global stage. It is an ideological competition as well.