The reaction, when it came, was brutal.
deepseek's r1 is an impressive model, particularly around what they're able to deliver for the price.
we will obviously deliver much better models and also it's legit invigorating to have a new competitor! we will pull up some releases.
— Sam Altman (@sama) January 28, 2025
On January 27th, as investors realized just how groundbreaking the new “v3” and “1” models were, they wiped around a trillion dollars off the market capitalization of America’s listed tech firms. A major chipmaker and the chief supplier in the artificial-intelligence gold rush saw its value plunge by $600bn.
People don’t talk enough about a giant DeepSeek achievement over most US models – it actually has a reasonable name.
— Ethan Mollick (@emollick) January 30, 2025
Yet even if the Chinese model-maker’s new releases rattled investors in a handful of firms, they should be a cause for optimism for the world at large.
DeepSeek highlights AI market shift
DeepSeek shows how competition and innovation will make AI technology cheaper and therefore more accessible and useful.
Another odd aspect of the sudden attention to DeepSeek is a lot of people assuming it is the first open weights* models. One of the biggest companies in the US has spent billions making open models & intends to keep doing so.
*not open source, there is no access to training data
— Ethan Mollick (@emollick) January 29, 2025
Despite the turmoil in the stock markets, the success of DeepSeek and other Chinese model-makers could accelerate the global innovation cycle, benefiting consumers and companies worldwide. This event underscores how global competition in tech can drive progress and make advanced technologies more available to a broader audience. Overall, the DeepSeek developments indicate a dynamic shift in the AI landscape, potentially democratizing access to powerful AI tools and spurring widespread technological advancement.
