HomeArticlesDeepSeek: the Chinese artificial intelligence that “broke” the market and American hegemony in AI

DeepSeek: the Chinese artificial intelligence that “broke” the market and American hegemony in AI

The scenario of Artificial Intelligence (AI) was recently shaken by the arrival of a new protagonist: DeepSeek. Developed by a Chinese startup, the tool promises to redefine what we mean by generative AI, challenging industry giants like OpenAI, Google and Microsoft. But what makes DeepSeek so special?

It is an open source AI platform, which stands out for its efficiency and low development cost, achieved from an innovative and quite disruptive technological architecture versus the best known models of generative artificial intelligence on the market. One of the most notable technical innovations is the so-called “intelligent”, which in layman's terms would be understood as the rounding formula used to facilitate calculations. Such an approach significantly reduces the need for memory and the associated costs, without compromising the accuracy of the results.

So while companies like OpenAI have invested around US$ 6 billion over a decade with a staff of 4,500 employees, DeepSeek has achieved comparable results in just two years, having a staff of less than 200 employees and investments approximately 1000 times smaller, between 5 and 6 million dollars.

DeepSeek is built on a hybrid architecture that merges deep neural networks with sparse attention mechanisms and advanced reinforcement learning algorithms.The combination allows you to process data more efficiently, reducing computational consumption while maintaining high accuracy.

Another differential is that DeepSeek adopts the approach of “mixture of experts” (mix of experts), activating only the computational resources needed for each task.The technique not only increases efficiency, but also reduces energy consumption, making the model more sustainable. Already one of the biggest advantages is the fact that it is an open source system. This means that anyone, whether a researcher, developer or technology enthusiast, can access its source code, study it, modify it and improve it according to their needs.

The democratization of AI enables developing countries and regions to access cutting-edge technologies without relying solely on proprietary, high-cost solutions, leveling the playing field and allowing different communities to benefit from AI advances to solve local challenges.

Impact on the market

The introduction of DeepSeek has had a significant impact on the technology and financial market. Companies such as Nvidia, a leading supplier of AI chips, have seen a sharp drop in their shares (which came from months of excessive appreciation) after the launch of DeepSeek, resulting in the loss of market capitalization of approximately 600 billion dollars (until the time I write this article). This demonstrates how much the” DeepSeek has challenged the status quo and it has prompted the re-evaluation of AI development strategies by large companies.

All of this was so impactful and transformative that even newly inaugurated US President Donald Trump, who has as one of his main banners of government the global leadership in AI by US companies, was forced to speak out.

In addition, the affordability and low cost of DeepSeek open opportunities for small and medium-sized businesses to adopt advanced AI solutions, previously restricted to large corporations due to high costs.

The success of DeepSeek signals a shift in the AI development paradigm (which was led and dominated by the US), bringing new heavyweight competitors to the industry, which will emphasize efficiency with accessibility.This approach is expected to encourage other companies to adopt open source models, seeking more resource-efficient solutions.

However, the preparation for this revolution requires that professionals and companies have some behaviors:

  • Update continuously: Staying informed about the latest trends and advances in AI is crucial. Reading news and attending courses, workshops and conferences can help keep up with the fast pace of innovations.
  • Adopt an open mindset: Being willing to try new tools and approaches, such as those offered by DeepSeek, can provide significant competitive advantages, since every day there are literally dozens of new features & IT will tend to accelerate.
  • Encourage collaboration: The open source nature of DeepSeek highlights the importance of collaboration in the AI community. Contributing to open source projects and sharing knowledge are actions that can accelerate collective progress, countering the main models hitherto in force in the market, paid and closed.

Digital transformation is at a rapid pace, and DeepSeek exemplifies how innovations can emerge unexpectedly, challenging established players and redefining the future of technology. Being prepared for change is critical to staying relevant and competitive in the current market.I am very curious and interested in following where all this will take us! What about you?

Fernando Moulin
Fernando Moulin
Fernando Moulin is a partner at Sponsorb, a boutique business performance firm, a professor, and a specialist in business, digital transformation, and customer experience. He is also the co-author of the best-sellers "Inquietos por Natureza" ("Restless by Nature") and "Você Brilha Quando Vive sua Verdade" ("You Shine When You Live Your Truth") (both published by Editora Gente, 2023).
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