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In a major turn of events, U.S. President Donald Trump has called the Chinese start-up DeepSeek a ''game-changer'' for the future of artificial intelligence (AI), urging the U.S. tech industry to "wake up" in response to the sudden disruption the company has caused. DeepSeek's low-cost AI chatbot, which launched only last week, has already outpaced competitors such as ChatGPT, sending shockwaves through Wall Street and raising concerns about the future of American dominance in the AI market.
The debut of DeepSeek's chatbot rattled the stock market, with shares of major tech companies, including Nvidia, suffering steep losses. Nvidia, a leading player in the AI and graphics processing unit (GPU) market, saw its market value drop by more than $500 billion. Other tech stocks also took a hit, with technology-focused markets in Japan following suit on Tuesday, while markets in China, South Korea, and Taiwan remained closed for the Lunar New Year holiday.
DeepSeek, which has gained significant attention for its chatbot's free app downloads in the U.S., faced a setback after it reported being hit by a "large-scale" cyber attack. As a result, the company temporarily restricted new user registrations, though it remains a major player in the AI landscape.
Despite the challenges, DeepSeek's app has quickly become the most downloaded free app in the U.S. The success of the chatbot has raised eyebrows, especially given that the startup reportedly developed the technology at a fraction of the cost of its rivals. While OpenAI, the company behind ChatGPT, spent around $5 billion last year alone, DeepSeek claims to have built its AI model with a budget of just $5.6 million.
This cost-effective approach has fueled concerns about the future of U.S. investment in AI and its ability to compete with emerging players like DeepSeek. Many have questioned whether the U.S. tech industry can maintain its lead when a company like DeepSeek can achieve such success with minimal investment.
Venture capitalist Mark Andreessen called DeepSeek's rise "the Sputnik moment of artificial intelligence," drawing a parallel to the launch of the Soviet Union's satellite that sparked the space race in the late 1950s. His comments reflect the profound impact DeepSeek’s success has had on the global perception of AI innovation.
On the Chinese internet, DeepSeek’s achievements were met with jubilation, as many users celebrated the company’s rise to the top in the AI industry. The excitement reflects growing confidence in China's ability to compete with the U.S. in the technology sector.
As the U.S. tech industry grapples with this new challenge, it remains to be seen how companies will adapt to the growing competition from China. With DeepSeek's rapid ascent, the future of AI development is becoming increasingly uncertain, and many are left wondering if the U.S. will maintain its dominant position or if new global players will emerge to reshape the landscape.
