- By Prateek Levi
- Tue, 28 Jan 2025 11:05 AM (IST)
- Source:JND
DeepSeek AI: We have now entered an era where AI-led innovation is taking over and is all the buzz in the market and with its constant evolution several players are taking part in this race. Now there is a new player in the market that has garnered significant traction in the tech world since its inception, and that is DeepSeek. Since its launch, China's DeepSeek has quickly overtaken established players like ChatGPT, Gemini, and Claude AI in performance. So, what makes DeepSeek stand out from the crowd?
What Is DeepSeek?
DeepSeek is a cutting-edge AI model developed by a research lab based in Hangzhou, China, which also carries its name. Founded in 2023 by Liang Wenfeng, an engineer with expertise in both AI and quantitative finance, the lab has quickly made waves in the AI industry.
The model at the heart of DeepSeek’s success is DeepSeek-V3, an advanced open-source system that has gone on to surpass OpenAI’s ChatGPT as the top-rated free app on Apple’s App Store in multiple countries, including the US, the UK, and China. DeepSeek’s rise is notable because it challenges the long-held assumption that the US dominates the AI space, particularly in Silicon Valley.
DeepSeek’s latest iteration, R1, is now competing with AI titans like OpenAI and Anthropic. What sets it apart? It’s affordable, open-source, and offers unlimited free access, providing high-performance AI capabilities without the hefty price tag usually associated with such technologies.
How DeepSeek Stands Apart from OpenAI and Meta
Unlike AI giants like OpenAI and Meta, which rely on costly infrastructure and powerful AI chips like Nvidia's H100 GPUs, DeepSeek has created a model that delivers comparable performance at a fraction of the cost. This is achieved through the use of more affordable hardware and an innovative approach to training its models. In addition to cost-efficiency, DeepSeek’s chatbot offers a unique feature: it explicitly explains its reasoning before responding, which sets it apart from OpenAI’s ChatGPT.
Furthermore, DeepSeek's open-source model allows developers to build upon its technology, further enhancing its appeal in the AI space.
Why Is DeepSeek Gaining So Much Attention?
The main reason why DeepSeek is changing the game and getting ahead of other players in the market is that it’s free, open-source, and unlimited. This makes it incredibly efficient and easy for users to access and has even earned praise for its transparency. On top of that, because of its free and accessible nature, it is now available to a broader range of users, something that was only accessible by a few with resources in the past
The timing of DeepSeek's success is also significant. The US has imposed restrictions on advanced semiconductor exports to China, aimed at limiting China’s ability to develop advanced AI. Despite these challenges, DeepSeek has managed to circumvent these hurdles by building models that require fewer resources, allowing them to stay competitive without relying on expensive chips.
This breakthrough has not come without creating some friction among the major US tech companies, such as Nvidia, Meta, and Microsoft, as these companies have shed a lot of money and invested heavily in creating models for AI infrastructure. Now, with DeepSeek gaining more and more prominence, these companies fear that they will soon end up in a new wave of competition that too against low-cost competitors like DeepSeek.
How is it Affecting the Stock Market?
This rapid rise of DeepSeek in the AI market has been shaking up the US stock market. Big players like Nvidia, Meta and even Microsoft who have heavily invested in this industry are witnessing a decline in their value of shares. Analysts are now warning that the emergence of affordable Chinese alternatives to US-made AI could shake up the investment landscape. This has forced tech companies to reconsider their AI strategies, as the demand for high-cost infrastructure may decrease in favor of more budget-friendly options like DeepSeek.
As DeepSeek continues to gain momentum, companies involved in the AI supply chain—including those making chips and other hardware—could also feel the pressure as profits from high-end products are threatened by these new, low-cost solutions.
In sum, DeepSeek's rise marks a significant shift in the AI landscape, one that could challenge the dominance of established players and transform the way AI is developed and accessed.
