February 5, 2025
China AI model impresses Silicon Valley

China AI model impresses Silicon Valley

A Chinese AI company competing with ChatGPT is gaining attention in Silicon Valley due to its rapid rise, almost outperforming leading US AI companies such as OpenAI and Meta.

DeepSeek is a Chinese AI startup that develops open-source large language models (LLMs), according to the company’s website.

The company on January 20 unveiled R1, a specialized model designed for solving complex problems, which “zoomed into the global top 10 in terms of performance” and was built much faster, with fewer, less powerful AI chips, at a much lower price. lower cost than other US models, according to the Wall Street Journal.

The announcement of the latest version of the app came on President Donald Trump’s inauguration day, when another of China’s social media apps, TikTok, made headlines over whether it would be banned in the US.

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Image from DeepSeek

A chatbot app developed by Chinese AI company DeepSeek. (Getty Images / Getty Images)

Meta’s chief AI scientist, Yann LeCun, spoke on social media about the app and its rapid success.

He pointed out in a post on Threads that what struck him most about DeepSeek’s success was not the increased threat created by Chinese competition, but the value of keeping AI models open so everyone could benefit.

“It’s not that Chinese AI is ‘outpacing the US’, but rather that ‘open source models are outpacing proprietary models,’” LeCun explains.

“DeepSeek has taken advantage of open research and open source (e.g. PyTorch and Meta’s Llama). They came up with new ideas and built them on top of the work of others,” LeCun continued. “Because their work is published and open source, everyone can benefit from it. That is the power of open research and open source.”

Just days after the release of the latest version of DeepSeek, Meta CEO Mark Zuckerberg announced that his company plans to spend more than $60 billion by 2025 as it remains steadfast in AI.

Meta’s latest move aims to strengthen the company’s position against rivals OpenAI and Googling in the race to dominate AI.

Big Tech companies have invested tens of billions of dollars in developing AI infrastructure following the success of OpenAI’s ChatGPT.

Meta’s announcement came just days after Trump announced that OpenAI, SoftBank and Oracle will form a venture called Stargate and invest $500 billion in AI infrastructure in the US.

“Deepseek R1 is one of the most amazing and impressive breakthroughs I have ever seen,” wrote Marc Andreessen, a Silicon Valley venture capitalist who advised Trump, in a post on X. “And as open source, a great gift to the world. ”

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“DeepSeek R1 is AI’s Sputnik moment,” Andreessen wrote in a comment.

Alexandr Wang, CEO of Scale AI, a San Francisco-based software company, also spoke out about the technology, saying DeepSeek’s rapid success is a “wake-up call for America.”

“DeepSeek is a wake-up call for America, but it doesn’t change the strategy,” Wang wrote in a post on X.

Wang explained that “the US must innovate and race faster, as we have done throughout the history of AI” and “tighten export controls on chips so that we can maintain future lead.”

“Every major breakthrough in AI has been American,” says Wang.

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ChatGPT AI photo illustration

The ChatGPT logo appears on a smartphone screen in this illustration photo in Reno, United States, on January 3, 2025. (Jaque Silva/NurPhoto via Getty Images/Getty Images)

DeepSeek’s development was led by a Chinese hedge fund manager, Liang Wenfeng, who has become the face of the country’s AI push, the Journal wrote.

Experts told the Journal that DeepSeek’s technology still ranks behind OpenAI and Google. However, it is a close competitor, despite using fewer and less advanced chips and in some cases skipping steps that American developers consider essential.

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On Saturday, the Journal reported that DeepSeek’s two models ranked in the top 10 on Chatbot Arena, a platform hosted by researchers at the University of California, Berkeley that rates chatbot performance.

Although DeepSeek’s flagship model is free, the Journal reported that the company charges users who connect their own applications to DeepSeek’s model and computing infrastructure.

Breck Dumas and Reuters of FOX Business contributed to this report.

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