DeepSeek’s big question: Where does AI’s true value reside?
Subscribe to enjoy similar stories. U.S. tech companies are used to some competition from China, but DeepSeek seems to be operating on another level.
The given news that OpenAI is investigating whether DeepSeek trained its chatbot by repeatedly querying the U.S. company’s AI models to exfiltrate large volumes of data in a technical process called distillation. Even if that is the case, however, the competitive threat to U.S.
tech companies is rising, as is the challenge of protecting their intellectual property. Questions about distillation of models notwithstanding, DeepSeek has earned the attention—and the respect—of U.S. technologists.
“I would say, personally, we have seen the Chinese today, this week establish themselves as first-rate software developers," Jared Spataro, chief marketing officer of Microsoft’s AI at Work group, told me. Venture capital investors and the startup founders of Silicon Valley have long defined themselves as disrupters, attacking the flanks of established companies. In a cycle going back more than half a century, one startup emerged after another, more or less from Silicon Valley, San Francisco or Seattle, the northern capital of the U.S.
tech empire. When promising startups emerged elsewhere, they were seen as farm-team players to elevate to the big leagues through investment and alliances. Microsoft’s partnership with French AI startup Mistral, itself founded by Google DeepMind and Meta veterans, sparked some resentment in Europe because it seemed to follow that model.
It has been funded by U.S. investors including Lightspeed General Partners, General Catalyst and former Google CEO Eric Schmidt. DeepSeek upended Silicon Valley in a more profound way, because the disruption came from
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