These days, DeepSeek is a popular AI launched by China, becoming a new competitor for ChatGPT. DeepSeek has also published its research paper, claiming it is far better than ChatGPT.
ChatGPT, launched by America, was one of the most popular AI tools. However, within days of its release, the DeepSeek AI assistant—a mobile app with a chatbot interface for DeepSeek-R1—topped Apple’s App Store chart, surpassing OpenAI’s ChatGPT mobile app.
The rapid rise of DeepSeek in usage and popularity caused a stock market sell-off on January 27, 2025.
Investors began doubting the value of major U.S.-based AI companies, including Nvidia. Tech giants like Microsoft, Meta Platforms, Oracle, and Broadcom also saw significant stock drops as investors reevaluated AI valuations.
What is DeepSeek?
DeepSeek is an AI development company based in Hangzhou, China. It was founded by Liang Wenfeng, a Zhejiang University graduate, in May 2023. Wenfeng also co-founded High-Flyer, a Chinese quantitative hedge fund that owns DeepSeek.
The company focuses on developing open-source large language models (LLMs). Its first model was released in November 2023. After several updates, DeepSeek gained global fame in January 2025 with the release of its R1 reasoning model.
The company offers various services, including a web interface, mobile app, and API access.
Capabilities:
DeepSeek claims its models are better than ChatGPT and has published comparisons on its website to support this.
Why is it concerning for America?
The launch of DeepSeek has raised alarms in the U.S., causing concerns and a stock market downturn, especially for tech stocks. There are several reasons for this:
Cost:
DeepSeek claims it developed its R1 model for less than $6 million. This low-cost development threatens U.S. tech companies that have invested billions in AI. DeepSeek is also cheaper for users compared to OpenAI.
Business Model
Unlike OpenAI, which uses proprietary technology, DeepSeek is open-source and free. This challenges the revenue model of U.S. companies that charge monthly fees for AI services.
Geopolitical Issues:
Being based in China, DeepSeek challenges U.S. dominance in AI technology. It shows the world that America cannot dominate AI alone.
Since China and the U.S. are unlikely to collaborate, neither country wants the other to dominate the tech industry.
Final Thoughts:
It’s clear that the world will no longer depend on a single country. We are heading toward a tech war,
but the focus should also be on business improvement, job creation, and humanity’s well-being. There’s still a long way to go, and we can only hope for the best.
Happy reading!