Begun the AI wars have

In the pre-ChatGPT era, everyone used to talk about how China was a leader in AI, and they were implementing cutting edge solutions in real life. Once ChatGPT came into the picture, everyone forgot about China. OpenAI took over the global mind space and the discussion centered around Sam Altman’s venture and its competitors.

Now China appears to have come out with something which we Indians call, “sasta, sundar aur tikau” (cheap, beautiful and lasting). In the last few days most timelines are full of the Chinese AI DeepSeek which has taken the world by storm. The irony is that OpenAI is closed and ChatGPT is expensive, while DeepSeek is open source and free. It already seems to be outperforming ChatGPT on many metrics. While ChatGPT spends an estimated $5 billion annually, DeepSeek took $6 million to make! Their R1 is out and already the world is stunned. R1 uses reinforcement learning versus huge datasets. 

Worrying for Silicon Valley is the fact that DeepSeek is outperforming ChatGPT in terms of US downloads on certain app stores. Even more worrying is the fact that DeepSeek allegedly did it without Nvidia chips causing its stock to tank upto 18% along with other American stocks. Global markets tanked a trillion dollars with the US contributing half of that. Even more disturbing is the fact that this seems to be a side project of Liang Wenfeng who is the co-founder of the hedge fund High-Flyer.

Tweets from the world of X 

Marc Andreessen invoked the US-USSR space race…

Deepseek R1 is AI's Sputnik moment.

— Marc Andreessen 🇺🇸 (@pmarca) January 26, 2025

The AI and Crypto Czar pointed fingers at the previous administration…

DeepSeek R1 shows that the AI race will be very competitive and that President Trump was right to rescind the Biden EO, which hamstrung American AI companies without asking whether China would do the same. (Obviously not.) I’m confident in the U.S. but we can’t be complacent.

— David Sacks (@DavidSacks) January 27, 2025

People pointed to China spying with a hint of irony…

Personally I’m staying away from Deepseek. I don’t want the Chinese spying on me and seeing what kind of videos I’m watching on TikTok

— greg (@greg16676935420) January 27, 2025

Some celebrated the war…

DeepSeek just emboldened and inspired startups all over the world to take on the giants. A lot of imagined moats are vanishing. Exciting times.

— Guillermo Rauch (@rauchg) January 27, 2025

It was bad news for US President Donald Trump who has just taken over…

🚨TRUMP: “The release of DeepSeek AI from a Chinese company should be a wake up call for our industries that we should be laser focused on competing to win. We have the best scientists in the world. This is very unusual. We always have the ideas. We’re always first.” pic.twitter.com/fFiRjxMTmZ

— Autism Capital 🧩 (@AutismCapital) January 28, 2025

And finally, what about India?

China’s DeepSeek sends global AI shockwaves, unseats ChatGPT on AppStores & makes a big splash.

The burning question: With India’s IT/Engineering/Startup muscle, where’s India’s own DeepSeek/ChatGPT?

My take: pic.twitter.com/pfhDGQGZPi

— Shiv Aroor (@ShivAroor) January 27, 2025