The stock of a tech giant dropped 16% after news about DeepSeek's low-cost AI developments and high performance spread. This reflects a broader trend in the U.S. tech industry, with an estimated $1 trillion loss in market capitalization, and concerns spreading to other sectors, including crypto. DeepSeek has outperformed OpenAI's o1 while operating at a significantly lower cost, causing disruption in the tech industry focused on computational power over efficiency. Chinese developers training their AI models on Nvidia H100 chips, which were barred from sale by the U.S., have also raised questions about the effectiveness of U.S. export controls. Chinese companies have an edge in AI development due to their embrace of open-source AI development, unlike the U.S., according to Professor Stoica. The lower cost of AI models has the potential to hurt tech companies but can also drive innovation and accelerate AI development.



Other News from Today