DeepSeek is a Hangzhou-based AI research lab and R1 is its latest AI model
Prof. Debakanta Mishra
DeepSeek is a new AI model from China. It has captured the attention of the tech world, surpassing the likes of ChatGPT, Gemini, and Claude AI in performance.
DeepSeek was launched last week. But by this time it has overtaken rivals including ChatGPT to become the most downloaded free app in the United States. Shares in US-based and AI-related tech firms such as Nvidia, Microsoft, and Meta were all down on Monday ahead of the US markets opening according to BBC.
Hedge Fund
DeepSeek is a Hangzhou-based AI research lab and R1 is its latest AI model. The company was founded in 2023 by Liang Wenfeng, an engineer and entrepreneur, with a background in AI and quantitative finance. Before creating DeepSeek, he had a hedge fund known for using AI to analyze financial data. Liang’s team at DeepSeek mostly consists of fresh graduates from top Chinese universities like Tsinghua and Peking University.
The company has now developed AI models that are open source and are helping developers across the world to improve their technologies. It is powered by the open-source DeepSeek-V3 model, which its researchers claim was developed for less than 6 million dollars-signifying much less than a billion spent by rivals.
The open-source AI system has surpassed OpenAI’s ChatGPT to become the top-rated free app in Apple’s App Store in several countries including the US, UK, and China. DeepSeek’s rise to prominence made a splash in Silicon Valley, challenging the belief that the US held the dominant position in this space.
DeepSeek’s latest model R1, rivals industry leaders such as OpenAI and Anthropic but stands out for being cost-efficient, open source, and offering unlimited free usage. It enables high-performance AI access without the steep costs typically associated with such technologies.
The one thing that sets DeepSeek R1, which is said to mimic human reasoning, apart from other AI models, is that it also provides its reasoning before delivering a response to a prompt. The company claims its performance is on par with Open AI’s latest technology.
Because of the above specific qualities, now questions are being raised about the need for huge investments in high-end AI accelerators like those from Nvidia. The rise of DeepSeek has had an immediate effect on stock markets. Analysts have warned that the rise of low-cost Chinese alternatives to established US AI models could disrupt the investment landscape, forcing companies to reconsider their AI strategies. By proving that progress does not depend on massive resources, this development offers hope that AI can be a tool to emerge-not just for the few with billions to spend.
Shock Waves
This development sends shock waves across the global AI landscape and its impact will be felt keenly in countries like India. For an emerging economy like ours, this breakthrough is a reminder that necessity often drives the best innovation. Therefore, India can draw important lessons from this. If the next phase of AI innovation is about efficiency, rather than scale, India could become a major player. Our strong base for software talent and entrepreneurial ecosystem positions us well to capitalize on this shift.
As the Chinese breakthrough shows, necessity is indeed the mother of innovation. By proving that progress does not depend on massive resources, this development offers hope that AI can be a tool for everyone-not just the few with billions to spend. It is a reminder that in the end, intelligence-whether artificial or human-is about thinking differently.
(The writer is a noted educationist and popular science writer. Views expressed are personal.)
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