DeepSeek, a Chinese AI startup, has drawn global attention with its advanced chatbot models that rival top AI systems at a fraction of the cost. Founded in 2023 by Liang Wenfeng, DeepSeek has rapidly gained traction, with its mobile app topping download charts in multiple countries.
The company’s R1 model stands out for its reasoning-based approach, competing with OpenAI and Meta on key performance benchmarks. Its efficiency challenges the belief that AI advancements require massive computational power and costly hardware, raising concerns for Nvidia and other chipmakers. The stock market reacted sharply, with Nvidia losing $589 billion in value as investors reassessed AI infrastructure spending.
DeepSeek’s rise also has geopolitical implications. Despite U.S. export restrictions on advanced chips, Chinese engineers have made significant progress, fueling competition in the global AI race. However, questions remain about data security and the app’s censorship on politically sensitive topics in China.
While DeepSeek faces infrastructure challenges due to its rapid growth, its open-source approach has driven down AI costs and could accelerate innovation worldwide. The company’s impact may reshape AI’s development trajectory, pressuring U.S. firms to cut prices and improve efficiency.
Cost of development vs rival AI systems?
DeepSeek is grabbing America’s attention, and sending a shock wave through Wall Street, because of the low development costs for its AI app. According to Wedbush Securities analyst Dan Ives pegged DeepSeek development costs are estimated at only $6 million. By comparison, OpenAI, Google and other major U.S. companies are on track to invest a total of roughly $1 trillion in AI over the coming years, according to Goldman Sachs.
How is DeepSeek different to ChatGPT?
DeepSeek vs ChatGPT: Free usage and premium pricing
The free tier on both platforms allows users to ask questions, look up trivia, solve puzzles or problems, and more. However, while ChatGPT’s free tier comes with limited usage on a daily basis, DeepSeek appears to have no such restrictions
How is DeepSeek different from OpenAI?
OpenAI’s o1 model uses chain-of-thought reasoning but doesn’t show users what is happening behind the scenes. Taking it a step further, the reasoning DeepSeek’s model produces can be used to train a smaller AI model.
