OpenAI CEO Sam Altman recently shared his thoughts on the emerging Chinese artificial intelligence (AI) startup DeepSeek, calling its new DeepSeek-R1 AI model “impressive.” Altman acknowledged the capabilities of the model, which has sparked global attention due to its affordability and efficiency compared to other industry-leading models, including OpenAI’s own offerings.
DeepSeek, a low-cost AI startup based in China, has been garnering significant attention after releasing a paper that outlined the cost-effectiveness of its DeepSeek-V3 model. The startup reported that training this model required less than $6 million in computing power, utilizing Nvidia’s lower-capability H800 chips. This announcement shook the AI world, particularly with its claims of a significantly lower cost for training models, which has raised questions about the need for expensive resources in AI development.
The launch of DeepSeek-R1, unveiled just last week, only added to the excitement. The company claims that the R1 model is between 20 to 50 times more affordable to use than OpenAI’s O1 model, depending on the task. DeepSeek has even shared the cost-effectiveness of its model on its official WeChat account, emphasizing the value of affordability in AI solutions.
Sam Altman’s reaction to DeepSeek’s progress was positive, noting that the R1 model’s performance and value for money are noteworthy. However, Altman quickly reiterated OpenAI’s belief in the importance of greater computing power in achieving long-term AI success. On the social media platform X, Altman remarked, “DeepSeek’s R1 is an impressive model, particularly around what they’re able to deliver for the price,” but emphasized that OpenAI’s mission is still guided by the principle that more computational resources are essential for reaching higher levels of AI performance and research.
DeepSeek’s rapid rise has led many to question the future of AI investments, especially in light of U.S. companies’ pledges to commit billions of dollars to AI development. The emergence of DeepSeek, with its efficient and cost-effective approach, casts doubt on whether such enormous investments are truly necessary to remain competitive in the space. This shift in the AI landscape has had immediate effects on the market, with Nvidia seeing a record one-day loss of $593 billion in market value on Monday. This significant drop marks the largest single-day loss for any company in Wall Street history, underscoring the shifting dynamics within the tech industry.
As competition intensifies, OpenAI and other companies may need to rethink their strategies in response to DeepSeek’s rise and the broader evolution of AI technology.
