Spark Deep Dive: Chinese AI start-up DeepSeek makes a splash with new chatbot

Chinese artificial intelligence (AI) start-up DeepSeek released its chatbot app on January 20. Its performance has challenged the dominance of American tech giants like OpenAI.

The large language model (LLM) is called R1. DeepSeek released an earlier model called the V3 in December. According to the firm, V3 was built at a fraction of the cost and computing power that major US tech companies use to build their LLMs.

The low cost of DeepSeek called into question the billions of dollars US tech companies are spending on energy-hungry data centres. Some regarded it as a shocking realisation for the US AI industry, especially because DeepSeek boasts an open-source model.

The Chinese company said it had outperformed leading US developers’ products on various industry benchmarks, including for mathematical tasks and general knowledge.

Denis Simon is a non-resident fellow at the US think tank Quincy Institute. He said the most important lesson for the West was that “there were many paths to the same innovation target”.

He added that DeepSeek had followed an innovative approach to push “the frontier of the current thinking about AI technology”.

“By developing a lower cost, more efficient, and perhaps even more effective path to producing ‘artificial general intelligence’, DeepSeek has shown that it’s not all about scale and money,” Simon said.

“In fact, it is about cultivating talent and thinking more about software integration than it is about accumulating thousands and thousands of advanced chips.”

Led by DeepSeek founder Liang Wenfeng, the team is a pool of fresh talent. Many of them are young researchers and doctorates from top Chinese universities.

US President Donald Trump called DeepSeek a “wake-up call” after US stocks were affected amid fears the model could threaten American dominance in the technology sector.

DeepSeek was the most downloaded free app on the Chinese iOS App Store as of January 27. It also dethroned OpenAI’s ChatGPT to claim the top spot on the US iOS App Store.

DeepSeek has integrated the model into its chatbots’ web and app versions for unlimited free use.

OpenAI charges US$200 per month for unlimited access to its o1 models. A standard plan with limited access costs around US$20 per month.

Staff writers

1. According to the news, which of the following is NOT a characteristic of DeepSeek?

(1) It offers unlimited use of its chatbot for free.
(2) It was more expensive to develop than ChatGPT.
(3) It was developed in the US.
(4) It was designed by Chinese researchers.

A. (1), (3) only
B. (2), (3) only
C. (1), (4) only
D. (3), (4) only

2. List TWO reasons why DeepSeek is causing a stir in the AI industry.

3. According to Denis Simon, what is ONE reason for DeepSeek’s success and what could US technology companies learn from it?

1. How does the graphic relate to the information presented in the news?

2. Using the news and the graphic, list TWO factors contributing to the growth of China’s AI industry.

large language model (LLM): a type of artificial intelligence that can understand and create human language. These models learn by studying huge amounts of text from books, websites, and other sources.

data centres: giant warehouses that house powerful computers and networking equipment, storing and processing the world’s data.

open-source: software made available to the public for free, allowing anyone to view, modify, and distribute its code.

advanced chips: specialised computer chips used to run the complex AI algorithms needed for natural language processing and generation.

1. B

2. The makers of DeepSeek say they spent less money and used less energy to create the chatbot than OpenAI did for ChatGPT. It is also open-source, meaning the software is free to the public. This allows anyone to view, modify, and distribute its code. (accept all reasonable answers)

3. Simon said DeepSeek focused on talent, hiring young professionals to work on its chatbot. American companies tend to prioritise acquiring advanced chips. American companies could learn from DeepSeek by shifting their focus to hiring talented researchers and software integration, saving them money. (accept all reasonable answers)

1. The graphic shows the US and China AI industries. ChatGPT and OpenAI are represented by the tree growing in America, and the one in China is DeepSeek. China’s industry is still small and growing compared to the US, as depicted by the smaller tree.

2. The graphic shows China’s industry receiving support in the form of technology and cash. Companies like DeepSeek are also focusing on building a pool of talented people to advance their technology rather than spending money on acquiring advanced chips. (accept all reasonable answers)