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DeepSeek: The Chinese AI App Leading App Store

Chinese AI app DeepSeek has taken the world by storm, climbing to the top of the App Store and challenging established AI giants like ChatGPT and Apple Intelligence. Its rapid success has shaken investor confidence in big tech and raised questions about the future of generative AI. Here’s everything you need to know about this surprising newcomer.


A Major Player Emerges

The generative AI space has long been dominated by Western giants like OpenAI’s ChatGPT, Google Gemini, and Apple Intelligence. While smaller players exist, few have managed to make a splash—until now.

DeepSeek, a Chinese app, has skyrocketed in popularity since its launch, quickly claiming the top spot on the U.S. App Store and others around the globe. Its large language model (LLM), officially released just one week ago, has already been hailed as a milestone in AI.

But despite its meteoric rise, some experts are skeptical about how long DeepSeek will remain in the spotlight.


Affordable AI That Works

DeepSeek operates as a chat app, similar to ChatGPT, allowing users to ask questions or perform tasks using its LLM, DeepSeek-V3. What sets it apart is its resource efficiency—made possible by necessity.

Due to U.S. restrictions on AI chip exports to China, DeepSeek’s developers had to innovate. They created a reasoning model, R1, that analyzes queries and minimizes processing costs by only using relevant parts of the LLM. The result? Significant savings in hardware and operational costs.

Perhaps the most remarkable feat is that DeepSeek’s model was developed on a modest budget of just $5.58 million. For comparison, OpenAI’s development has benefited from billions of dollars in investments, including Microsoft’s massive contributions, while the U.S. government’s Stargate AI project comes with a $500 billion price tag.

Even more impressively, DeepSeek achieved this by releasing its LLM as an open-source model, downloadable by anyone, including via platforms like Hugging Face.


Market Disruption

DeepSeek’s sudden rise has sent shockwaves through the tech industry, especially on Wall Street. The app’s ability to deliver ChatGPT-like responses at minimal cost has spooked investors, leading to a major dip in AI-related stocks.

Chipmaker Nvidia, a key supplier of expensive hardware for AI projects, took the biggest hit, with its shares dropping by 17% at one point, wiping out more than $600 billion in market value in a single day, according to BBC reports. Other major players like Microsoft and Meta also saw their stocks affected, though Apple appeared largely unscathed.

DeepSeek’s success raises important questions: Could this cheaper, more efficient approach reduce reliance on high-priced hardware like Nvidia’s chips? And what does this mean for the future of big tech’s dominance in AI?


Popularity Brings Challenges

While DeepSeek’s rapid success is impressive, it hasn’t been without hurdles. The platform is currently facing a suspected distributed denial of service (DDoS) attack, causing disruptions for users.

In response, DeepSeek has limited new account registrations. Currently, only users in China with a +86 country code can sign up, while existing users can continue using the app without issues. According to the status page, the company is actively working to mitigate the attack, though it’s unclear how long restrictions will remain in place.


A “Sputnik Moment” for AI?

DeepSeek’s rise is being viewed as a wake-up call for the AI industry. Tech investor Marc Andreessen has even referred to it as “AI’s Sputnik moment,” highlighting how U.S. efforts have been blindsided by a breakthrough from a rival superpower.

However, the app’s Chinese origins could spark controversy in the West. The U.S. has historically scrutinized Chinese tech for potential security risks, as seen with Huawei and TikTok. If DeepSeek gains further traction, it’s likely to face similar accusations, investigations, and possibly even bans.

Regardless of its future, DeepSeek has already made its mark by showing that AI can be developed on a tighter budget with fewer resources. Its success challenges the status quo and could force Western companies to rethink their approach to AI development.


What’s Next for DeepSeek?

DeepSeek’s impact on the AI world is undeniable. Whether it will continue to thrive—or face challenges from governments and competitors—remains to be seen. For now, it stands as a testament to innovation under constraints and a symbol of the growing competition in the AI space.

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