DeepSeek, a low-cost Chinese chatbot, has sent shockwaves through the tech industry by challenging America’s AI dominance and plummeting shares in major US technology firms.
The Rise of DeepSeek: A Low-Cost Chinese Chatbot Challenging America’s AI Dominance
The emergence of a low-cost chatbot called ‘DeepSeek’ has sent shockwaves through the tech industry, with shares in major US technology firms plummeting after its rapid rise to become the most downloaded free app in the US. The Chinese artificial intelligence (AI) firm behind DeepSeek claims it was developed for a fraction of the cost of its rivals, raising questions about the future of America’s AI dominance and the scale of investments US firms are planning.
How Did DeepSeek Become So Popular?
DeepSeek‘s success can be attributed to its affordability, with the company claiming that its researchers trained the AI model for around $6m – significantly less than the billions spent by rivals. However, this claim has been disputed by others in the AI community. The researchers say they use existing technology and open-source code, which can be used, modified, or distributed by anyone free of charge.
The Impact on US Tech Giants
The sudden popularity of DeepSeek has startled stock markets in Europe and the US, with tech giants such as Nvidia, Microsoft, and Meta seeing their share prices drop. In fact, AI chipmaker Nvidia ended Monday’s trading having plunged 16.9%, while its rival Broadcom slumped 17.4%. Other tech firms also sank, with Microsoft down 2.14% and Google‘s owner Alphabet down over 4%.
Nvidia is a multinational technology company that specializes in designing graphics processing units (GPUs) and high-performance computing hardware.
Founded in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem, Nvidia has become a leader in the field of artificial intelligence, deep learning, and gaming.
The company's GPUs are used in various industries, including 'gaming' , scientific research, and automotive manufacturing.
Nvidia's technology also powers many popular applications, such as virtual reality and augmented reality experiences.
What Does This Mean for the Future of AI?
The emergence of DeepSeek has raised concerns about the future of America’s AI dominance. With US tech giants investing $500bn in building AI infrastructure in the US, it seems that China is catching up quickly. The Chinese government has also been restricting the sale of advanced chip technology to China, forcing developers to share their work and experiment with new approaches.
With a population of over 1.4 billion, China is the world's most populous country.
Its economy has experienced rapid growth since the introduction of economic reforms in 1978, making it the second-largest economy globally.
China has also become a major player in international trade, with the Belt and Road Initiative (BRI) aiming to connect over 60 countries through infrastructure development.
The country is home to four UNESCO World Heritage Sites, including the Great Wall and the Forbidden City.
Is DeepSeek a Game-Changer?
DeepSeek‘s founder, Liang Wenfeng, reportedly built up a store of Nvidia A100 chips, now banned from export to China. Experts believe this collection led him to launch DeepSeek by pairing these chips with cheaper, lower-end ones that are still available to import. The company claims its AI model is on par with one of OpenAI‘s latest models when used for tasks such as maths, coding, and natural language reasoning.
Cybersecurity Concerns
DeepSeek has also been the victim of a cyberattack, which has led the company to temporarily limit registrations. ‘Due to large-scale malicious attacks on DeepSeek’s services, we are temporarily limiting registrations to ensure continued service,’ it said in a statement.
In conclusion, the rise of DeepSeek is a significant development in the AI industry, with potential implications for US tech giants and the future of AI dominance. As the technology continues to evolve, it will be interesting to see how companies respond to this new challenger.
Artificial intelligence (AI) has been rapidly advancing in recent years, with significant breakthroughs in machine learning, natural language processing, and computer vision.
This has led to increased adoption across industries, from healthcare to finance.
According to a report by Gartner, AI-related spending is projected to reach $190 billion by 2025.
As AI continues to improve, it's expected to automate routine tasks, enhance decision-making, and drive innovation.
