The frenzy unleashed by an artificial intelligence chatbot created by the China Depseek technological startup put Wall Street on Monday and fed debates on economic and geopolitical competition between the United States and China in the development of AI technology.
The Deepseek’s assistant became the most unloaded free application in Apple’s iPhone store on Monday, driven by curiosity about the Chatgpt competitor. Part of what worries some observers of the United States technology industry is the idea that the Chinese startup has reached US companies at the forefront of the generative AI to a fraction of the cost.
If that is true, the huge amounts of money are questioned that the technology companies of the United States say they plan to spend on data centers and the necessary computer chips to boost additional advances in AI.
But the hype and misunderstandings about Depseek’s technological advances also sowed confusion.
“The models that built are fantastic, but neither are miracles,” said Stacy Rasgon, Bernstein analyst who follows the semiconductor industry and was one of several stock market analysts who described the reaction of Wall Street as exaggerated.
“They are not using any innovation that is unknown or secret or something like that,” Rasgon added. “They are things that everyone is experiencing.”
What is Deepseek?
The Deepseek startup was founded in 2023 in Hangzhou, China and launched its first large – -sized language model that same year. Its general director, Liang Wenfeng, previously co-founded one of China’s main investment funds, High-Flyer, which focuses on quantitative operations promoted by AI.
By 2022, the background had accumulated a 10,000 chips of high performance graphic processing A100 of NVIDIA, based in California, which are used to build and execute AI systems, according to a publication on the Chinese Wechat social media platform. Shortly after, the United States restricted the sale of those chips to China.
Deepseek has said that its recent models were built with NVIDIA H800 chips, which are of lower performance and are not restricted for sale to China, which sends the message that the most sophisticated hardware could not be necessary for the investigation of Vanguard in Ia.
Deepseek began to attract more attention in the AI industry last month, when he launched a new AI model that claimed that he was on the par of similar models of US companies such as OpenAi, the creator of Chatgpt, and that he was more profitable in The use of the expensive Nvidia chips to train the system in huge amounts of data. The chatbot became more accessible when it appeared in Apple and Google application stores recently this year.
But it was a monitoring investigation article published last week – the same day of the swear of President Donald Trump – which triggered the panic that followed. That article was about another Deepseek model called R1 that showed advanced “reasoning” skills, such as the ability to rethink its approach to a mathematical problem, and was significantly cheaper than a similar model sold by Openai called O1.
“How are your economies, I have no idea,” said Rasgon. “But I think the price points scared people.”
The “Sputnik Moment” of the AI
Behind the drama about Depseek’s technical capabilities there is a debate within the United States on how to compete with China in AI.
“Deepseek R1 is the Sputnik moment of AI,” said investor Marc Andreessen on the social network X, referring to the launch of the satellite in 1957 that gave way to a space race between the Soviet Union and the United States.
Andreessen, who has advised Trump on technological policy, has warned that the excessive regulation of the AI industry by the United States government will hinder US companies and allow China to take the lead.
But care in Depseek also threatens to undermine a key strategy of US foreign policy in recent years to restrict the sale of AI semiconductors designed by the United States to China. Some experts in relations between the two countries do not believe that this is a coincidence.
“Technological innovation is real, but the moment of launch is political by nature,” said Gregory Allen, director of the Wadhwani center at the Center for Strategic and International Studies. Allen compared Deepseek’s announcement last week with the launch of a new telephone by the Chinese company Huawei, sanctioned by the United States, during diplomatic discussions on the export controls of the Biden administration in 2023.
“Demonstrating that export controls are useless or counterproductive is a really important objective of Chinese foreign policy at this time,” added Allen.
Trump signed an order on his first day in office last week that said his administration “would identify and eliminate gaps in existing export controls,” noting that it is likely to continue and harden the Biden approach.