Dumb questions, from someone not in the field... What is a distilled model? Why doesn't Google do this (to make their models smaller)? Seems like you could make a competitor to Gemini?
In normal LLM training, you take a set of documents and have it learn to predict the future, then have some private RLHF/RLVR etc. data that it learns to produce good chat outputs from.
In distillation, you take a set of prompts you are interested in, and record the big LLM's outputs, then train your small model to produce the same output as the big LLM.
This has a few advantages - you can get performance much more quickly on your documents/prompts of interest, with a much cheaper training budget, and you don't have to worry about acquiring very expensive RLHF/RLVR training data.
A lot of the very good Chinese LLMs got very good very quickly through distillation from frontier models, which is why Anthropic/Google/OpenAI are blocking it so aggressively.