The tech world and the USA economy were rattled by the introduction of DeepSeek’s latest open-source AI model, and rightfully so. 

It has garnered the attention of all artificial intelligence solutions providers, and in this post, we will discover why that is happening.  

DeepSeek AI: The Latest AI Model in Town   

DeepSeek AI V3 Model  

Created by a Chinese AI company, DeepSeek V3 is a foundational model claimed to be made on a mere budget of 6 million dollars. It is only a fraction of the price invested by big tech companies like Google, OpenAI, and Microsoft for creating similar products. However, the lower cost does not mean worse performance in this case. It surpassed GPT-4o and Claude 3.5 Sonnet in various benchmarks.  

DeepSeek AI is a standout because of its architecture, which is known as Mixture-of-Experts (MOE). This architecture takes the idea of one big model managing everything and divides it into various small specialist teams who are working together to answer your questions.  

Additionally, it is trained on 14.8 trillion tokens, which consist of high-quality datasets for better language understanding and task-specific capabilities.   

Moreover, it uses the Multi-Head Latent Attention (MLA) to improve efficiency and lower the cost of training and deployment.   

All these factors allow it to compete with the other advanced models of today.  

DeepSeek R1 Model  

Using V3 large language model, DeepSeek launched the R1 model on 10th January 2025. This integrates advanced reasoning capabilities, especially in logical inference and problem-solving. This model can address math equations and decision-making, outperforming OpenAI’s o1 in benchmarks like Americal Invitational Mathematics Examination (AIME) 2024.   

The biggest takeaway is that it is open source. It means that they are sharing the Code for people to study, replicate, and even better its capabilities. This is going to change the entire revenue model for the AI industry.   

DeepSeek’s Janus-Pro-7B Model  

On the last Monday of January 2025, they launched Janus-Pro-7B. A multimodal model capable of processing various media types, including images. It is even better due to the ability to combine the capabilities of unified models with task-specific performance.   

DeepSeek’s Impact on America Tech Giants  

DeepSeek latest release ended up wiping off $1 trillion from the US tech giants in a day. NVIDIA lost about 17%, which is around $589 billion in its market value. Other companies that suffered losses include Microsoft, shedding $7 billion, and Google parent company Alphabet losing $100 billion.  

President Donald Trump addressed these developments on Monday, and said, “The release of DeepSeek AI from a Chinese company should be a wake-up call for our industries that we need to be laser focused on competing.”   

Why Did NVIDIA stocks plummet after the introduction of DeepSeek AI?  

NVIDIA is focused on creating high-performance AI chips, which, before the introduction of DeepSeek AI, were believed to be essential for creating foundational models. The notion has been challenged with these models, causing a drastic drop in NVIDIA stocks.   

Generally, US companies use advanced AI GPU NVIDIA H100 whereas, DeepSeek uses GPU—NVIDIA H800 to achieve better results. Therefore, they have been able to offer their services at better rates.  

ChatGPT V/S DeepSeek – How the Two Models Compare? 

Now that we know about Deep AI, let us look at how it compares to ChatGPT generative artificial intelligence solution.  

Cost: Both tools come with free and paid versions. ChatGPT paid subscription starts at $20/month, whereas DeepSeek subscription is only $0.50/month, making it much more affordable. 

Ideal Application:  

DeepSeek  is better at answering queries related to mathematics, logical reasoning, and coding. It offers concise and technical answers, along with reasoning to show how it reached the conclusion. 

ChatGPT is ideal for more creative and conversational situations, offering up-to-date information on current events. 

Environmental Impact: When comparing the two, DeepSeek is better for the environment as it uses 90% less energy and leaves a 92% lower carbon footprint. 

Supported Languages: One place where ChatGPT outshines DeepSeek is its ability to understand multiple languages. DeepSeek currently only works with English and Chinese. 

How are these Revolutions in Artificial Intelligence Solutions Going to Impact the Future?  

There are various possible outcomes of the introduction of DeepSeek artificial intelligence services to the world.  

One scenario includes rapid democratization of AI tools, making them more accessible. The big names will have to focus on providing additional value, whether through security, specialized features, or improved reliability, to capture the audience.  

However, as these “legacy” tools are made at significant cost, there is a good chance that these companies will rely on their reputation and compliance to retain customers. As they primarily get revenue from professional clients, they can still hold a sufficient share of the market.  

Microsoft has also alleged that DeepSeek linked group used OpenAI proprietary data and we will have to see how this impacts DeepSeek’s innovations.  

Artificial Intelligence Solutions – The Tech Wars Continue  

Launch of DeepSeek artificial intelligence solutions is a surprise because before this, China was not even considered a part of this race. Now, it is overtaking USA – the tech giants, offering better solutions at more affordable rates.  

There is still time to see who comes out on top.   

However, for businesses that want to use generative AI solution to their advantage, these revelations are still unfolding. If you want expert guidance on the best way to use artificial intelligence services as per your needs, getting in touch with an AI consulting company is your best choice.