Global reaction to how Chinese start-up 'DeepSeek' is shaping the AI market landscape

A Chinese AI startup, DeepSeek, is challenging industry giants with its cost-effective AI model, sending shockwaves through the tech industry and raising questions about AI development.

Our Moon Hye-ryeon has the details.

"I don't feel threatened by DeepSeek or any other AI model. In fact, competition and innovation in AI development push all models (including me) to improve and offer better responses."

This is the response that OpenAI's ChatGPT gives when asked about its new up-and-coming Chinese "competition" – DeepSeek.

And while ChatGPT may not feel threatened, the Chinese startup is attracting a wealth of attention in the AI market for users and investors alike as it claimed its new V3 model could be trained at a fraction of the cost required for the computing power from Nvidia's chips.

With its assertion that the model is not only cheap but rivals OpenAI and Meta's most advanced counterparts, the need to invest billions of dollars in AI technology from the United States is being put under question.

Its newest AI assistant has overtaken ChatGPT as the most downloaded free application in Apple's App Store in the U.S.

Global firms, leaders and investors are showing mixed reactions.

"The release of DeepSeek A. from a Chinese company should be a wake-up call for our industries that we need to be laser-focused on competing to win."

U.S. President Donald Trump's comments came as traders dumped big tech stocks – including a record one-day loss for Nvidia – resulting in American tech companies losing roughly a trillion dollars in market value.

His nominee to lead the Commerce Department, however, accused DeepSeek of leveraging "stolen" U.S. technology.

DeepSeek used parts of Meta's technology that was given away by the U.S. firm to be freely available online, but OpenAI said in a statement that they are currently reviewing indications that DeepSeek may have used the American tech giant's models to train its own.

Outside of the U.S., European countries showed concern over data security.

Italy's data protection authority has banned DeepSeek in a move to protect Italian user data, stating that the firm gave "insufficient" information on personal data usage, while France's privacy regulator is analyzing the tool to assess privacy risks.

As for South Korea, the focus is on how its semiconductor firms could be affected by potential changes in the AI landscape.

SK hynix is currently supplying memory chips to Nvidia, and now, Samsung Electronics has been reportedly approved to do so too – meaning that Nvidia's standing in the AI market will affect domestic chip firms in turn.

Samsung Electronics issued a statement on Friday saying that they are currently monitoring the market, but it is too early to judge with the limited information currently available.

There are also mounting concerns that tensions between Washington and Beijing will intensify with this competition in advanced technology, prompting Trump to strengthen regulations on China in the high-tech industry.

Moon Hye-ryeon, Arirang News.