Do you remember the “DeepSeek moment”? The Chinese startup announced that it has created an artificial intelligence model that could compete with ChatGPT in early 2025. Moreover, the products were made at a much lower cost than their American competitors.
If you thought China was lagging behind the United States in AI, DeepSeek has changed that. Almost immediately, the model became the most downloaded free app in the United States. Some in Silicon Valley have begun calling this “AI’s Sputnik moment.”
DeepSeek launched its latest model last week. Today my colleague Meaghan Tobin, who covers technology in Asia, writes about how DeepSeek’s model has not only put China and the United States at the forefront of the AI race, but has revolutionized the nature of the race itself.
What DeepSeek Really Changes in the Global AI Race
Megan Tobin
Early last year, Chinese startup Deep Seek sent global tech stocks tumbling when it announced it had spent far less on computer chips to build new artificial intelligence models than its U.S. rivals such as Anthropic and OpenAI. At the time, analysts thought the DeepSeek moment heralded a major shift in the global technology landscape.
A little over a year later, and in the wake of the release of DeepSeek’s highly anticipated latest model late last month, it’s clear that DeepSeek has indeed transformed the global technology landscape. It just wasn’t in the way analysts expected.
Rather than forcing AI companies to use computer chips more efficiently, DeepSeek has revealed the benefits of making the details of this technology widely available to the public.
Before DeepSeek, the details of the world’s highest-performing AI systems were mostly company secrets. In contrast, DeepSeek has opened up the details of its system for anyone to use and build on. This is called open source.
In the months that followed, the model became one of the most widely used open source AI systems in the world. And the DeepSeek moment started an incredible transformation. While American companies have locked away their best models, AI has become one area where China, known for its strict government controls on technology and information, has embraced openness.
AI’s Big Mac
Open source is an idea as old as the Internet itself.
America’s top AI companies say only a few people have access to all the details of a technology that has the potential to be extremely powerful and even dangerous. But many proponents of open source argue that technology advances faster and is actually more secure when it is shared and transparent.
Initially, many Chinese companies turned to open source because it was easier to build on the foundations laid by other companies. But the race to build the best AI soon turned into a geopolitical struggle. And Chinese officials are beginning to see the open-source nature of their model as a potential soft power victory.
These models make AI more affordable and accessible to developers and app builders around the world. People building AI apps in the United States, as well as Nigeria, Malaysia, and Brazil, have found that using the Chinese model can be more than 90% cheaper than paying to build them using OpenAI technology and others.
China has invested billions of dollars to become an AI superpower. Being known as the birthplace of popular and widely available AI systems can help cement that image among those using the technology around the world. One technology investor I interviewed likened the soft power of open source AI to the impact of Hollywood movies and Big Macs.
In the months following the initial DeepSeek release, Chinese tech companies have released dozens of other open source models. By the end of last year, about a third of global AI usage was related to the Chinese open source model.
Not everyone is on board with China’s use of AI. Government agencies in South Korea, Taiwan, and Australia have told their employees not to use DeepSeek’s models due to concerns about the company’s approach to security and data protection.
Silicon Valley leaders at Anthropic and OpenAI have accused DeepSeek of unfairly using their technology to build its own technology, and have characterized the rivalry between U.S. and Chinese AI companies as an ideological rivalry. “We want to make sure that democratic AI trumps authoritarian AI,” said Sam Altman, CEO of OpenAI.
But what’s more important to most users is affordable AI.
Move fast but follow the rules
China’s embrace of open source is not as contradictory as it may seem. The technology is open for anyone to develop, but must still adhere to China’s rules. Rather, there is a contradiction in China’s full acceptance of AI itself.
The Chinese government wants cutting-edge AI, but AI is inherently unpredictable. It will be used in ways people haven’t even thought of yet. And China’s leadership does not want new technologies to disrupt the stability of Chinese society and the Chinese Communist Party’s dominance.
The government is asking Chinese companies to do two things at once. That means China must move quickly to outperform its international competitors while complying with increasingly complex regulations. We’ll find out if this eventually starts to hinder China in the global AI race.
DeepSeek’s latest model may not have been as popular as its predecessor, but it still performs well. When it comes to writing computer code, it lags behind the best models from OpenAI and Anthropic. And if the popularity of China’s open source model over the past year is any indication, coders around the world probably don’t feel like they need the best. It just has to be good enough and cheap enough.
Trump’s Iran prediction appears to be falling apart
Talks between Iran and the United States remained deadlocked yesterday. President Trump said on social media on Saturday that he would likely reject Tehran’s latest offer. An Iranian Foreign Ministry spokesman said yesterday that the United States had conveyed its response to Iran’s 14-point plan to Pakistani mediators and that Tehran was reviewing it, but there were no signs that the situation would progress. Here’s what we know:
President Trump hinted to reporters over the weekend that he could resume military strikes. Tehran officials said a new military confrontation was possible, according to the Iranian News Agency.
The Strait of Hormuz remains effectively closed and energy markets are in turmoil. Trump wanted short-term conflict. What he got was a complicated, expensive and unpopular war with no clear ending.
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British people gather in bars, Finns gather in saunas. For Icelanders, the social hub where people unwind is the swimming pool or hot tub. The country has about 150 swimming pools, usually heated by geothermal energy, most of which are outdoors and open all year round. And for the most part, it goes unnoticed by tourists. until now.
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