Seeing Silicon | DeepSeek has democratised the AI field. What now ...
President Donald Trump had just announced Stargate, a $500 billion AI venture to keep US dominance in AI going when DeepSeek hit the world like wildfire. The startup from Hangzhou, a city in eastern China, comprising recent graduates from Chinese universities, had launched R1, its AI model that was much cheaper, used less computing power and performed better than AI models coming from the Silicon Valley billion-dollar companies in some parameters.
The Impact
On Castro Street, in downtown Mountain View, which is the headquarters of Google, everyone from screen-dazed techies in coffee shops to food app delivery groups milling outside restaurants furiously discussed the new free app, which became the most downloaded free app in the United States this week, overtaking OpenAI’s ChatGPT. The DeepSeek model was open source, allowing anyone to download, copy and build upon them.
As the business potential of owning an AI model poofed in the air, so did $600 billion of market cap from NVIDIA's valuation, a whopping 17% of its total net worth. All last week a mix of denial, anger and suspicion played out in Silicon Valley offices as AI-junkies stared at their plummeting stock portfolios.
The Disruption
The Chinese startup didn't have access to a lot of infrastructure but had managed to train it at a fraction of computing and energy requirements. As a result, R1 is 50 times cheaper to run than many other US AI models. Overnight OpenAI’s complete business model has vanished and its expensive training processes have come into question in its boardroom.
The Response
The US government, while advocating free markets, expressed concerns about DeepSeek potentially compromising user privacy and censorship issues. These concerns led to the introduction of a potential legislative bill that could criminalize DeepSeek downloads in the US.
Despite the controversies, the emergence of DeepSeek highlighted the democratization of AI model development, challenging the belief that high compute capacity is essential for scaling AI models.
The Future
As competition intensifies in the AI landscape, AI models have become more affordable to develop, opening up opportunities for countries across the globe. Initiatives like IndiaAI Mission seek to leverage AI models trained on local datasets, reflecting a shift towards more accessible and inclusive AI development.
DeepSeek's R1 has not only leveled the AI playing field but has also significantly reduced entry barriers, sparking discussions on the future of AI development and adoption.
