DeepSeek: The Friendly Blue Whale Disrupts the World of AI
Who’d ever thought that a friendly blue whale would rock the boat? A newcomer in the world of artificial intelligence has made quite the entrance, with large language model’s DeepSeek’s meteoric rise to prominence. This intrusion has not only shaken up the tech world but also sparked significant alarm in the U.S., particularly among major players in the AI and tech industries, such as ChatGPT and Meta’s Llama.
When DeepSeek-V3 and its earlier version, Deepseek-R1 was released, the market’s reaction was swift and severe. On January 27, 2025, the Nasdaq Composite dropped by 3.4% at market opening, with Nvidia seeing a staggering 17% decline. This resulted in a $600 billion loss in market capitalization.
But why such unrest? The primary reason for this unease lies in DeepSeek ai’s cost efficiency and its potential to disrupt long-established business models that have long relied on hefty investments in AI technology.
The Heart of DeepSeek’s Disruptive Power
DeepSeek’s ability to deliver high-performing AI at a fraction of the cost of other competitors has certainly rocked the boat. The company claims to have developed its R1 model for less than $5.576 million, a stark contrast to the $100 million spent to create the latest version of ChatGPT.
This cost-effective development model not only threatens to undermine the financial structure of its American competitors, but also gives DeepSeek a significant advantage when it comes to attracting users.
For example, a pro subscription to OpenAi costs $200 a month as of February 2025. If you want to compare pricing in terms of input tokens (one token = 4 characters), then ChatGPT API costs $2 for around 750,000 English words. Alternatively, DeepSeek charges $0.20 for the same amount of tokens, and it is also still free to use. If one desires a cheaper alternative to the more established platforms, DeepSeek is mighty appealing.
It goes without saying that offering a large language model that is affordable and high performing will definitely cause a degree of alarm, influencing tech stock performance at the very least.
Going against the Tide
DeepSeek’s rise to popularity is also a mystifying story. It has achieved much despite having restricted access to cutting-edge U.S. technology. With the export of advanced AI accelerators and GPU chips to China highly restricted, DeepSeek has demonstrated that you can build a leading-edge AI model without top-notch U.S hardware.
On top of that, DeepSeek’s open-source and free business model poses a direct challenge to the subscription-based models employed by U.S. firms.
While OpenAI and others charge users for access to their AI tools, DeepSeek has made its technology available without cost, undercutting competitors. With better accessibility without sacrificing performance, DeepSeek challenges the overall economic model dominates the majority of the AI industry today.
Also, as a Chinese company, DeepSeek challenges the U.S.’s dominant position in AI development. Tech investor Marc Andreessen has compared DeepSeek’s emergence to AI’s “Sputnik moment,” nodding to the famous space race that happened last mid-century. Will iron sharpen iron? Only time will tell.
In many ways, DeepSeek’s success signals a new era in the global AI “arms race”, one where the U.S. may no longer have a monopoly on cutting-edge development. This is huge. DeepSeek has the potential to reshape the entire landscape of AI innovation as we know it.
Not Embraced Everywhere
Despite its rapid rise and technological prowess, DeepSeek has already faced significant pushback from various countries and organizations due to concerns over ethics, privacy, and security. Here are some concerns:
- All user data processed by DeepSeek is stored in China.
- DeepSeek’s LLM was trained with a Chinese worldview.
As a result, DeepSeek has been banned in several regions and institutions, including:
- Australian government agencies
- Italy
- NASA
- Taiwan government agencies
- Texas state government
- U.S. Congress
- U.S. Navy
- U.S. Pentagon
These bans highlight the evident connection between global AI development and national security, with governments wary of the influence that foreign AI companies could wield over sensitive data and decision-making processes.
DeepSeek’s Potential Use in Recruitment
DeepSeek’s potential use in recruiting could revolutionize the way companies approach talent acquisition, just like ChatGPT, Gemini, and other large language models have proven quite helpful.
With its advanced natural language processing and ability to analyze vast amounts of data quickly, DeepSeek could also be leveraged to streamline the recruitment process by automating candidate screening, conducting initial interviews, and even matching job seekers with the most relevant positions based on their skills, experience, and cultural fit.
By using DeepSeek to sift through resumes, chat with candidates, and analyze responses, companies could not only reduce hiring costs but also improve the efficiency and accuracy of their recruitment efforts.
Additionally, its open-source, cost-effective model makes it accessible to a wider range of organizations. Easier to integrate into even tight budgets, it can offer significant assistance without the burden of expensive subscriptions.
However, careful attention must be paid to ethical concerns surrounding data privacy and bias, especially given DeepSeek’s origins and the global scrutiny it currently faces.
The DeepSeek Model; A Force Indeed
DeepSeek’s rise as a formidable AI challenger marks a pivotal moment in the tech industry. Its ability to deliver powerful, cost-efficient AI models has already disrupted the market, forcing established players like OpenAI and Google to reconsider their business strategies.
However, this innovation comes with significant challenges, particularly around privacy, security, and geopolitical concerns. The widespread bans and heightened scrutiny from governments around the world underscore the complex dynamics at play when cutting-edge technology intersects with national interests.
While DeepSeek’s future remains uncertain, its rapid ascent is a clear indication that the landscape of AI is shifting. Whether it leads to a more competitive, open market or sparks further geopolitical tensions, one thing is certain: DeepSeek is reshaping the future of artificial intelligence in ways that no one can afford to ignore.
