DeepSeek, a new Chinese AI app, has sent shockwaves through the tech industry, triggering a massive sell-off of major tech stocks and raising questions about America's dominance in AI. DeepSeek's developers claim to have built the latest model for a mere $5.6 million, a fraction of the cost incurred by AI giants like OpenAI, Google, and Anthropic. This development has stunned many Silicon Valley observers, prompting discussions about the potential impact on the future of AI and the global tech landscape.
The speed at which the new Chinese AI app DeepSeek has shaken the technology industry, the markets and the bullish sense of American superiority in the field of artificial intelligence has been nothing short of stunning.
This extraordinary, historic spooking can largely be attributed to something as simple as cost. And a claim by DeepSeek's developers which prompted serious questions in Silicon Valley. Some wondered if this marked a buying opportunity. Others questioned the information DeepSeek was providing. The US seemed to think its abundant data centres and control over the highest-end chips gave it a commanding lead in AI, despite China's dominance in rare-earth metals and engineering talent.The US may still go on to command the sector, but there is a sense that DeepSeek has shaken some of that swagger.
The company has said its models deployed H800 chips made by Nvidia. US policy restricting sales of higher-powered chips to China might get a second-look under the new Trump administration.
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