The Impact of DeepSeek on the US AI Landscape: A Comprehensive Analysis

The Impact of DeepSeek on the US AI Landscape: A Comprehensive Analysis

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DeepSeek, the latest AI-driven chatbot to emerge on the internet, has garnered attention even among those with a casual interest in generative artificial intelligence. Distinct from familiar chatbots such as ChatGPT and Google Gemini, DeepSeek hails from China. Following its launch, it quickly ascended to the top of the free app rankings on Apple's App Store. The promise of DeepSeek lies in its ability to maintain significantly lower operational costs compared to its American counterparts, a factor that has likely raised concerns among its U.S. competitors and stirred activity in financial markets.

To provide context, DeepSeek claims that its development costs were approximately $6 million, a stark contrast to the billions reportedly invested by companies like OpenAI in advancing generative AI technologies and creating platforms like ChatGPT.

What is the foundation of DeepSeek? Who is behind its creation? In what ways does it differ from ChatGPT? Are U.S. companies feeling the impact? This article addresses these inquiries.

What is DeepSeek? 

DeepSeek is a relatively new entity, established in July 2023 and based in Hangzhou, China. The company launched its DeepSeek AI chatbot for free on the Apple App Store on January 10. Liang Wenfeng, the founder, reportedly financed the startup through his hedge fund.

But where did Liang Wenfeng get the computing power to develop DeepSeek? 

How did Liang Wenfeng acquire the necessary computing power for DeepSeek's development? According to MIT Technology Review, Liang, who possesses a background in artificial intelligence, procured a significant number of Nvidia A100 chipsets—renowned for their capabilities in AI—prior to their prohibition in China, which have played a crucial role in the development of DeepSeek.

How to access DeepSeek?

Although DeepSeek is developed in China, it is easily accessible in the United States through the Apple App Store, and users can also engage with the platform via its website at chat.deepseek.com. However, a login is required to begin utilizing the service.

Are Nvidia and other technology leaders concerned about DeepSeek?

In the realm of generative AI, most significant developments have emerged from the United States, with companies such as OpenAI, Google, and Claude leading the charge. While China has made contributions to this field, the predominant discourse has centered around American enterprises.

Recently, DeepSeek has garnered considerable attention, emerging as a cost-effective alternative to ChatGPT and reportedly closing the gap with its competitors. This development has caused a stir in the U.S. markets.

Sam Altman, CEO of OpenAI, has acknowledged DeepSeek R1, stating, “DeepSeek's R1 is an impressive model, particularly regarding its value proposition.” He further remarked, “We will undoubtedly produce superior models, and it is genuinely refreshing to have a new competitor! We will accelerate our releases.”

The introduction of the DeepSeek bot has also raised concerns for Nvidia, a company renowned for its hardware that facilitates AI advancements. On Monday, Nvidia experienced the largest single-day market cap decline in U.S. history, with an astonishing $600 billion erased from its valuation. Reports indicate that DeepSeek utilizes chips that are not as advanced as Nvidia's latest technology, challenging the assumption that only high-end chipsets can drive progress in generative AI—a belief supported by firms like Meta and OpenAI.

Is DeepSeek different from ChatGPT or Google Gemini?

While the fundamental user experience is similar to that of ChatGPT and Gemini—where users input a prompt and receive responses—the operational mechanisms of DeepSeek are inherently distinct from those of ChatGPT and its underlying language model.

DeepSeek operates as an open-source large language model that utilizes inference-time computing. It is important to note that this technology significantly reduces both costs and computational resources. This is the mechanism by which DeepSeek distinguishes itself from competitors such as OpenAI.

Read Also: Upcoming iOS 18.4 Release Set for April with Enhanced Siri Features

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