DeepSeek: The New AI Player Challenging and Outperforming Big Tech

Discover how China’s DeepSeek, the new AI player, is revolutionising the industry with its open-source, cost-effective models that challenge and outperform OpenAI and Google’s AI systems.

In the rapidly evolving world of artificial intelligence, a new player has emerged from China, challenging the dominance of Big Tech giants like OpenAI and Google. DeepSeek, a startup founded by Liang Wenfeng, has introduced AI models that are not only technically superior but also significantly more affordable.

This article explores how DeepSeek, the new AI player, is making waves in the tech industry and what sets it apart from its competitors. With its innovative approach, DeepSeek has quickly garnered attention and admiration from industry experts and investors alike.

DeepSeek was born out of Liang Wenfeng’s quant trading hedge fund, High-Flyer, which uses AI to predict market trends and make investment decisions. In 2021, Wenfeng began purchasing thousands of Nvidia chips for an AI side project, which eventually led to the launch of DeepSeek in 2023.

Since then, DeepSeek has rapidly gained attention for its cutting-edge AI models that rival those of industry leaders at a fraction of the cost. The startup’s remarkable progress has been fuelled by a dedicated team of engineers and researchers who are committed to pushing the boundaries of AI technology.

This commitment to innovation and excellence has enabled DeepSeek to develop AI models that are not only powerful but also efficient and cost-effective. The journey of DeepSeek is a testament to the potential of emerging markets to disrupt established industries. By leveraging China’s growing expertise in technology and AI, DeepSeek has positioned itself as a formidable competitor in the global tech landscape.

The company’s success has also highlighted the importance of strategic investments in technology and talent, which have been key drivers of its rapid growth and development. As DeepSeek continues to expand its capabilities, it is poised to challenge the dominance of established AI players and set new benchmarks for the industry.

DeepSeek’s AI models have been making headlines for their impressive performance and affordability. Unlike OpenAI’s ChatGPT, which has been criticised for not fully delivering on its open-source promise, DeepSeek has released its models as open-source, allowing anyone to download and run them locally on their devices.

This transparency ensures that users’ data remains private and free from censorship. Moreover, DeepSeek’s commitment to openness has fostered a thriving community of developers and enthusiasts who contribute to the ongoing improvement of the models.

The success of DeepSeek’s open-source approach has demonstrated the potential for collaborative innovation in the AI space. By making its models accessible to a wider audience, DeepSeek has enabled researchers and developers around the world to experiment with and build upon its technology.

This has led to a rapid iteration and improvement cycle, resulting in AI models that are constantly evolving and becoming more sophisticated. In contrast, proprietary models like ChatGPT often face limitations in terms of accessibility and collaboration, which can hinder their development and adoption.

One of the most significant advantages of DeepSeek is its cost-effectiveness. While OpenAI’s training costs are in the tens of millions of dollars, DeepSeek claims to have trained its model for just over $5.5 million.

This cost-saving is passed on to consumers, with API access for DeepSeek-R1 starting at $0.14 for one million tokens, compared to OpenAI’s $7.50 per million tokens. This price difference makes advanced AI technology more accessible to a wider range of users, from small businesses to individual developers, democratising the benefits of AI.

The affordability of DeepSeek’s AI models has significant implications for the broader tech industry. By lowering the barriers to entry, DeepSeek is enabling a more diverse group of innovators to access and utilise AI technology. This increased accessibility is likely to spur new waves of innovation and creativity, as more individuals and organisations can experiment with and develop AI-driven solutions.

Additionally, the cost savings offered by DeepSeek can help businesses of all sizes improve their efficiency and competitiveness, ultimately driving economic growth and development.

DeepSeek’s emergence has had a profound impact on the tech industry, particularly in the U.S. on Monday, January 27 2025, shares of Nvidia sank by 17%, leading to a broader selloff that affected the Nasdaq and S&P 500. This reaction highlights the growing concern among investors about the future of AI investments and the potential disruption caused by DeepSeek’s cost-effective models.

As more companies realise the potential of affordable AI, the pressure mounts on established tech giants to innovate and reduce their costs. The ripple effects of DeepSeek’s success are being felt across various sectors, from technology to energy.

For example, Constellation Energy, which has benefited from AI data centres consuming massive amounts of electricity, saw its shares plunge by 20% recently. This highlights the interconnected nature of the tech industry and the far-reaching impact of disruptive innovations like DeepSeek.

As DeepSeek continues to gain traction, it is likely to reshape the competitive landscape and force established players to adapt to new market dynamics.

As DeepSeek continues to grow and evolve, it will be interesting to see how it shapes the future of artificial intelligence. The company’s commitment to open-source development and affordability has set a new standard for the industry, challenging established players to rethink their approaches to AI innovation.

DeepSeek’s success also underscores the importance of fostering a collaborative and inclusive innovation ecosystem, where diverse perspectives and ideas can thrive.

Looking ahead, DeepSeek is poised to play a significant role in the ongoing evolution of AI technology. The company’s cutting-edge models and cost-effective solutions have the potential to drive significant advancements in various fields, from healthcare to finance to entertainment.

By making AI technology more accessible and affordable, DeepSeek is helping to democratise the benefits of AI and ensure that more people can leverage its transformative potential.

As the AI landscape continues to evolve, DeepSeek’s innovative approach is likely to inspire new waves of creativity and innovation, ultimately shaping the future of artificial intelligence.

DeepSeek is a game-changer in the AI industry, offering open-source, affordable models that outperform those of Big Tech companies. Its innovative approach to AI development and commitment to transparency and affordability have positioned it as a formidable competitor in the tech space.

The rise of DeepSeek also serves as a reminder that innovation can come from unexpected places, and that the tech landscape is constantly evolving. As DeepSeek continues to grow and expand its capabilities, it will be fascinating to watch how it influences the future of artificial intelligence and drives new waves of technological advancement.

I’m NOEMI, the Founder of Online Harbour, Noemi’s Media, and CG Strategies. I’m passionate about sharing knowledge that enriches both professional and personal lives. My global entrepreneurial experience, supported by an MBA and a background in IT, Computer Sciences, Business, and Financial Markets, has prepared me with diverse perspectives that I’m excited to share with you.