Background information
7 questions you have about DeepSeek (and the answers)
by Samuel Buchmann
DeepSeek: Chinese AI model makes Wall Street tremble
27/1/2025
Translation: machine translated
The shares of Nvidia and other tech companies have fallen massively in value. The reason for this is DeepSeek. The AI model from China shows how fragile the USA's dominance is.
The Chinese start-up DeepSeek is only two years old. But its new AI app shot to number 1 in the Apple App Store over the weekend - and surprises with a performance that apparently even surpasses established models from OpenAI, Meta and Google.
Thus, DeepSeek is challenging US AI supremacy virtually out of nowhere. As a result, the shares of the major tech companies are plummeting. The Nasdaq index fell by up to five per cent at times, which is extremely high for one day. Nvidia even lost up to 18 per cent.
Top performance with a fraction of the effort
The latter includes DeepSeek. What shocks analysts most about the new AI model: Development, training and operation are apparently massively cheaper than at market-leading companies such as OpenAI. Put simply, it looks as if the Chinese start-up achieves a comparable performance with a fraction of the effort.
According to the company's own figures, the development of the new AI model DeepSeek R1 cost the equivalent of less than six million US dollars. OpenAI reportedly spent around 100 million US dollars on the development of GPT-4o. Training DeepSeek took just 2.78 million GPU hours. Llama 3.1, the comparable model from Meta, required 30.8 million GPU hours.
Doubts about political neutrality
DeepSeek R1 is open source. OpenAI CEO Sam Altman accuses the Chinese start-up on X of copying ChatGPT: "It's easy to copy something that you know works." However, ChatGPT is not an open source model that could be easily copied. Rather, DeepSeek appears to be copying the architecture, training the model with GPT outputs and building on it.
Update 28/01/2025: DeepSeek is now running stably again and sometimes answers questions on topics that are politically sensitive in China in a seemingly random pattern. However, the bot has quite clear views. Here is an example:
We talk about the topic in detail in the latest Tech Affair episode
Header image: Shutterstock
Samuel Buchmann
Senior Editor
Samuel.Buchmann@digitecgalaxus.chMy fingerprint often changes so drastically that my MacBook doesn't recognise it anymore. The reason? If I'm not clinging to a monitor or camera, I'm probably clinging to a rockface by the tips of my fingers.
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