The recent rise of DeepSeek, a Chinese generative AI chatbot, has sent shockwaves through the tech world. But beneath the hype lies a more nuanced reality.
The launch of ‘Sputnik moment‘ , where the US lost its supremacy in AI technology, has sent shockwaves through the tech world.
DeepSeek: A Notable Achievement, But Not a Breakthrough
Technically, DeepSeek is no advance on large language models (LLMs) that already exist. It is neither faster nor ‘cleverer’ than OpenAI‘s ‘ChatGPT‘ or Anthropic‘s ‘Claude‘ and just as prone to ‘hallucinations’ – the tendency, exhibited by all LLMs, to give false answers or to make up ‘facts’ to fill gaps in its data.
According to NewsGuard, a rating system for news and information websites, DeepSeek‘s chatbot made false claims 30% of the time and gave no answers to 53% of questions. This exposes the profound unreliability of all LLMs. DeepSeek‘s particularly high non-response rate is likely due to its censoriousness; it refuses to provide answers on any issue that China finds sensitive or about which it wants facts restricted.
The True Impact: Democratizing AI Technology
The true impact of DeepSeek is not on the technology itself, but on the economics of AI. It is a chatbot as capable and flawed as other current leading models, but built at a fraction of the cost and from inferior technology. The US ban on the sale to China of the most advanced chips and chip-making equipment may have spurred Chinese researchers into becoming more innovative.
Artificial intelligence (AI) is transforming industries and economies worldwide.
The global AI market is projected to reach $190 billion by 2025, with 'AI adoption driving economic growth in various sectors.'
In the US, 'AI is expected to contribute up to 13% of GDP growth by 2030.'
As AI increases productivity and efficiency, it also raises concerns about job displacement and income inequality.
Experts predict that while some jobs will be automated, new ones will emerge, requiring workers to develop skills complementary to AI.
Ripping Away the Veil of Mystique
DeepSeek is also free to use and open source. This combination of low cost and openness may help democratize AI technology, enabling others, especially from outside America, to enter the market. There is a certain irony that China is opening up the technology while US firms continue to create barriers for competitors.
The Business Model Depends on Hype
The hype around DeepSeek reflects the broader hype surrounding AI. The tech industry has nurtured an image of AI as a precious and miraculous accomplishment, with its leading figures portrayed as prophets guiding us into a new world. However, this approach seeks to advance AI less through major scientific breakthroughs than through a brute force strategy of ‘scaling up’ – building bigger models, using larger datasets, and deploying vastly greater computational power.
DeepSeek has disrupted this approach by demonstrating that the best generative AI models can be matched with much less computational power and a lower financial burden. The tech industry’s reliance on hype to drive investment and influence is unsustainable, and DeepSeek has exposed the flaws in this model.
