It took about a month for the finance world to start freaking out about DeepSeek, but when it did, it took more than half a trillion dollars â or one entire Stargate â off Nvidiaâs market cap. It wasnât just Nvidia, either: Tesla, Google, Amazon, and Microsoft tanked.
DeepSeekâs two AI models, released in quick succession, put it on par with the best available from American labs, according to Alexandr Wang, Scale AI CEO. And DeepSeek seems to be working within constraints that mean it trained much more cheaply than its American peers. One of its recent models is said to cost just $5.6 million in the final training run, which is about the salary an American AI expert can command. Last year, Anthropic CEO Dario Amodei said the cost of training models ranged from $100 million to $1 billion. OpenAIâs GPT-4 cost more than $100 million, according to CEO Sam Altman. DeepSeek seems to have just upended our idea of how much AI costs, with potentially enormous implications across the industry.
This has all happened over just a few weeks. On Christmas Day, DeepSeek released a reasoning model (v3) that caused a lot of buzz. Its second model, R1, released last week, has been call …