DeepSeek, a Chinese AI company, has rapidly gained global attention. Its chatbot app became the most downloaded free app on Apple’s store. Released in the US in January, the app’s sudden success, along with its low costs, has shaken financial markets.
The company claims its AI models rival top US-based systems, like ChatGPT, at a fraction of the development cost. Researchers revealed that DeepSeek was built with only $6 million, significantly less than the billions spent by US AI firms.
What is DeepSeek?
DeepSeek is an artificial intelligence company based in Hangzhou, China. It launched in July 2023 and quickly made waves. Its AI assistant app debuted in the US on January 10, 2024, according to Sensor Tower.
Liang Wenfeng, an engineering graduate, founded DeepSeek and partially funded it using money from a hedge fund he launched. He reportedly amassed around 50,000 Nvidia A100 chips, now banned from export to China.
Experts believe Liang paired these high-end chips with more affordable ones to lower costs. Recently, he was seen at a meeting with Chinese Premier Li Qiang, highlighting his influence in the tech industry.
Who is Using DeepSeek?
The app is free and widely available on Apple’s App Store and the official DeepSeek website. It quickly became the most downloaded app in the US. Despite its popularity, some users reported minor sign-up issues.
DeepSeek serves as an AI assistant, similar to ChatGPT, and is designed to answer questions and enhance productivity efficiently. Users have praised its ability to add personality to writing. However, it avoids politically sensitive topics, as demonstrated when asked about Tiananmen Square.
Why Are US Tech Companies Affected?
DeepSeek’s low development costs have raised concerns about the future of America’s AI dominance. On January 27, the Nasdaq dropped over 3%.
Nvidia, a US-based chipmaker, was hit hardest, with its stock dropping 17%, erasing $600 billion in market value. DeepSeek’s reliance on less advanced chips challenges the belief that massive budgets and high-end chips are essential for AI progress.
As DeepSeek continues to rise, it sparks debates about innovation, cost efficiency, and the future of the global tech industry.
