Beijing: China's cost-effective and free DeepSeek artificial intelligence (AI) chatbot has taken the world by storm due to its rapid progress, rivaling the US-based OpenAI's ChatGPT with far fewer resources available. DeepSeek has gained unprecedented popularity in mobile app stores across the globe, dethroning ChatGPT in certain regions, including the US.
According to Anadolu Agency, the rapid progress of the large language model (LLM) has gained center stage in the tech world, as it is not only free, open-source, and more efficient to run, but it was also developed and trained using older-generation chips due to the US' chip restrictions on China. The world's leading AI firms typically use over 16,000 chips to train their models, while DeepSeek only utilized 2,000 older chips, with a budget of less than $6 million. In contrast, OpenAI has reportedly spent over $100 million on the most advanced model of ChatGPT, the o1, which DeepSeek is rivaling and surpassing in certain benchmarks.
DeepSeek's high performance against competing models from Google and OpenAI, which use much more advanced and expensive chips and infrastructure, has pressured Big Tech stocks. American chip giant Nvidia's shares fell as low as $117.26 on Monday, with the firm's one-day loss edging close to 18%, marking the highest daily loss since March 2020. Additionally, Nvidia's market cap decreased by over $500 billion, the largest daily decline in US stock market history.
The launch of DeepSeek has ignited a new debate over the costliness of LLMs, as the rise of low-cost models threatens the dominance of Western Big Tech in AI. Billionaire Mark Zuckerberg, the CEO of Meta, announced plans to spend $60 billion to $65 billion on AI infrastructure this year, while President Donald Trump stated the US would invest $500 billion. Trump also remarked that DeepSeek has been 'a wake-up call' for Silicon Valley, urging American firms to focus on competing.
OpenAI CEO Sam Altman commented on X that DeepSeek is an 'impressive model, particularly around what they're able to deliver for the price.' He added, "We will obviously deliver much better models and also it's legit invigorating to have a new competitor."