Shortly after releasing a model of its artificial intelligence service that appeared to be comparable to ChatGPT and other U.S.-based competitors but required significantly less processing power for training, the Chinese tech startup DeepSeek shot to fame.
Major stock price changes occurred on Monday as a result of the allegations against DeepSeek and the heightened interest in the firm.
DeepSeek’s influence has been extensive, evoking responses from public figures such as OpenAI CEO Sam Altman and President Donald Trump.
What you should know about DeepSeek is as follows.
What is DeepSeek and what does it do?
A major language model AI product called DeepSeek offers a service akin to ChatGPT.
Users can submit phrases or queries into DeepSeek using a computer program or phone app, and it will provide text responses.
The bilingual models from DeepSeek can comprehend and generate results in both Chinese and English.
A week ago, DeepSeek released its R1 model. According to the Artificial Analysis Quality Index, a widely used independent ranking of AI analysis, R1 is already outperforming a number of other models in terms of performance, including Google’s Gemini 2.0 Flash, Anthropic’s Claude 3.5 Sonnet, Meta’s Llama 3.3-70B, and OpenAI’s GPT-4o.
Who is behind DeepSeek?
Hangzhou DeepSeek Artificial Intelligence Co., Ltd. developed DeepSeek in Hangzhou, China.
Liang Wenfeng launched DeepSeek in 2023. He also started High-Flyer, a hedge fund that employs AI-driven trading techniques.
High-Flyer was one of DeepSeek’s investors, according to Liang, and supplied part of its initial staff.
How has the market reacted to DeepSeek?
The stock prices of tech giants, such as Nvidia, which manufactures processors needed for AI training, fell precipitously on Monday.
The possibility that a Chinese competitor would surpass the hundreds of billions of dollars that large U.S. tech companies are investing in AI technology sparked a flurry of speculation.
While many tech companies had mostly recovered, Nvidia’s pricing was still significantly lower on Tuesday morning than it was the previous week.
Nvidia described DeepSeek as a “excellent AI advancement” in a statement released on Monday, but insisted that AI inference required Nvidia’s own technologies. DeepSeek claims that fewer Nvidia chips than anticipated were used to train their solution.
How have tech figures and competitors reacted?
Microsoft CEO Satya Nadella, whose business is one of OpenAI’s largest investors, praised DeepSeek’s new model as “very impressive” during the World Economic Forum in Switzerland.
Known for co-creating one of the first web browsers in history, Mosaic, entrepreneur Marc Andreessen wrote on X on Sunday that DeepSeek R1 is AI’s Sputnik moment, drawing comparisons to the space race between the US and the USSR and the event that made the US realize that its technological prowess was not unchallenged.
Last month, OpenAI CEO Sam Altman made an appearance to criticize DeepSeek after several users reported that DeepSeek’s latest version, V3, would sometimes mix itself with ChatGPT.
Altman, however, stated on Monday that the new R1 was an excellent model, especially in terms of what they could offer for the price.
Naturally, we will produce far superior models, and having a new rival is genuinely energizing! He wrote on X. We’ll bring up a few releases.
Are there security or other concerns around DeepSeek?
Like other apps with Chinese connections, DeepSeek has been criticized in the United States for being a Chinese service. Experts have pointed out that under Chinese law, data sent to DeepSeek may be stored and monitored.
When answering some inquiries regarding China, DeepSeek also seems to reflect particular political views or ban certain topics.
DeepSeek’s R1 occasionally responds that the topic is beyond of its current purview when questioned about the sovereignty of Taiwan, an autonomous island democracy that Beijing asserts is its territory. At other points, the model states that Taiwan is an unalienable part of China’s territory and adds, “We are committed to achieving the complete reunification of the motherland through peaceful means and firmly oppose any form of Taiwan independence separatist activities.”
What are the reactions of politicians?Politicians in the US have responded to DeepSeek in a variety of ways thus far, with some urging strict legislation and others making more subdued remarks.
President Donald Trump stated on Monday that DeepSeek’s performance “should be a wake-up call for American tech companies” and that it may be a “positive development” for the AI sector. He didn’t specifically demand regulation in reaction to DeepSeek’s widespread use.
Going beyond what Trump mentioned in his statements, House Select Committee on China head Rep. John Moolenaar, R-Mich., stated Monday that he wants the United States to take action to slow down DeepSeek.
Sen. Mark Warner, a Democrat from Virginia, defended current export restrictions on advanced semiconductor technology and said that additional regulation may be required.