BU News Service: Deepseek – An Innovation or New Competition?
Excerpt from Boston University News Service | By: Daniela L. Ginsburg | February 12, 2025 | Photo: Justin Sullivan
On Jan. 27, the China-based company Deepseek sent shock waves through Wall Street.
In its stunning latest version, the Chinese-made artificial intelligence platform rose the ranks in the Apple Store as it offered a cutting-edge model for a portion of the budget. United States President Donald Trump called it a “wake-up call” for US companies who need to be “competing to win.”
Founded in 2023 by Liang Wenfeng, the private company claims to utilize fewer chips and a cheaper AI training model than its rivals. Deepseek trained its AI model for around $6 million, compared to ChatGPT which reported to have spent around $100 million.
Thomas Gardos, an Associate Professor of Computing and Data Science at Boston University, said that these key differences caused a panic and resulted in many major private companies pulling and selling off stock, creating a stock-market selloff. Gardos also said that besides these two major selling points, the model remained relatively the same as its rival competitors.
“At the consumer level, there’s really no differences,” Gardos said. “That’s why there was a sell off, they seem to be competitive with open AI at a fraction of the cost.”