DeepSeek AI App Shakes Tech Market and Hits Nvidia Hard
A Chinese AI app called DeepSeek has become the most downloaded free app on Apple’s store since it launched in the U.S. in January, according to BBC.
Its rapid rise and low-cost development have caused a big shake-up in the tech market, creating uncertainty about the future of AI in America.
DeepSeek, founded in 2023 by Liang Wenfeng in Hangzhou, China, built its AI assistant for just $6 million, far less than the billions spent by U.S. companies like ChatGPT’s creator.
As BBC explained, this has raised questions about how much money and high-end technology are really needed to compete in AI.
The app, which helps users with questions and tasks similar to ChatGPT, has impressed many with its performance. But it avoids sensitive topics, such as the events of Tiananmen Square, saying it’s designed to give “helpful and harmless responses.”
DeepSeek’s low-budget success has hit U.S. tech companies hard. On January 27, it caused a massive sell-off in the stock market, especially for companies like Nvidia, which creates powerful AI chips.
BBC reported that Nvidia lost nearly $600 billion in market value in a single day, the largest drop ever for a U.S. company. Its stock fell 17%, pushing it down to third place behind Apple and Microsoft in global value rankings.
DeepSeek uses cheaper and less advanced chips than Nvidia’s, proving that AI can still succeed without the most expensive hardware.
BBC highlighted that this discovery challenges the idea that only top-tier chips and huge budgets can lead in AI development.
It’s a wake-up call for the tech industry, showing how fast competition can come from unexpected places like DeepSeek.
Credit : BBC
https://www.bbc.com/news/articles/c5yv5976z9po