Why China’s DeepSeek is threatening to disrupt the AI industry


DeepSeek’s R1 model is available for free

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The China-based AI company DeepSeek sent shock waves through both Silicon Valley and Wall Street by releasing an AI model that competes with the best US ones but was made at a fraction of the cost. Although the news has sparked a sell-off of tech stocks and prompted venture capitalist Marc Andreessen to describe the results as “AI’s Sputnik moment”, this open-source AI is not as revolutionary as it seems.

Over the past year, AI models from companies such as OpenAI, Google and Meta have become capable…

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