Global tech stocks took a hit on Monday as investors reacted to the emergence of a Chinese chatbot competitor, Deepseek, on Openai’s ChatGpt. This raised concerns about the long-term sustainability of the artificial intelligence boom in the US.
The NASDAQ index in New York, heavily weighted towards tech, dropped as investors processed the news about Deepseek’s latest AI model development.
Companies like Nvidia, valued at over $400 billion, saw significant losses in their market capitalization as shares plummeted. Other tech giants like Alphabet and Meta also experienced declines.
Deepseek’s AI assistant topped the charts on the Apple App Store in the US and UK, surpassing Openai’s ChatGpt.
Stocks of other US-based AI companies like Tesla, Meta, and Amazon also saw declines in early trading.
Deepseek’s claims about developing advanced AI models using fewer chips than competitors have raised doubts around the massive AI investments made by US companies in recent years.
The company utilized lower-powered chips from Nvidia to create its model, highlighting the potential limitations of US technology export bans on China.
Venture capitalist Marc Andreessen likened Deepseek’s achievement to a “Sputnik moment” in the AI industry, signaling a notable disruption.
Deepseek’s R1 model outperforms other leading models in various benchmarks, challenging the dominance of tech giants like Google and Meta.
Founded by entrepreneur Liang Wenfeng, Deepseek focuses on research rather than commercial products, aiming to make AI accessible and affordable to all.
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Deepseek’s disruptive approach to AI has led to questions about the necessity of heavy investments in AI infrastructure and the supremacy of US tech companies in the field.
The pan-European Stoxx 600 and Asian tech stocks also took a hit, reflecting the global impact of Deepseek’s advancements.
Experts in the field acknowledge the significance of Deepseek’s breakthrough, highlighting the potential for innovation without the need for massive resources.
Source: www.theguardian.com
