The meteoric rise of Chinese AI company DeepSeek has captured global attention, stirring significant discussions across the tech world. Surging to the top of the U.S. Apple App Store's free app download charts—overtaking the previously dominant ChatGPT—DeepSeek's ascent has coincided with a notable decline in the stock prices of several American technology firms.
On Monday, U.S. President Donald Trump described DeepSeek's emergence as a \"wake-up call\" for American industries. Adding to the concern, U.S. congressional offices received notifications stating that the use of DeepSeek is \"unauthorized for official House use,\" according to a report by Axios on Thursday.
What is fueling this concern—even anxiety—in the United States over DeepSeek's rapid growth? A recent commentary by Yuyuan Tantian, a social media account affiliated with China Media Group, sheds light on this question. Citing insights from the China Academy of Industrial Internet, the commentary outlines three key reasons behind the U.S.'s apprehension.
Cost-Effective Disruption to the U.S. AI Model Monopoly
DeepSeek is redefining efficiency in artificial intelligence development by delivering top-tier performance at a fraction of the traditional cost. While industry leader OpenAI reportedly spent $78 million training its GPT-4 model, DeepSeek achieved comparable results with an investment of under $6 million. This has been made possible through a pioneering training approach that lowers AI's entry barriers, making large-scale pre-training accessible beyond the realm of tech giants.
Furthermore, DeepSeek's latest model, DeepSeek-R1, is priced at just $2.2 per million tokens—a stark contrast to OpenAI's o1 model, which costs $60 per million tokens. This significant cost reduction is making AI more affordable and opening vast potential for research institutions, enterprises, and knowledge-intensive industries worldwide.
Innovative Approach Sparks Panic Among U.S. Tech Professionals
By adopting a novel training strategy, DeepSeek has dramatically reduced development costs without compromising performance. Unlike OpenAI's reliance on massive computational power, DeepSeek employs advanced algorithms to filter, summarize, and selectively process training data. This method not only cuts costs significantly but also enhances efficiency.
The impact of DeepSeek's innovation is being acutely felt. Despite substantial investments in training its AI model Llama, Meta has not managed to outperform DeepSeek, which operates at a fraction of the cost. This outcome has led Meta executives to reevaluate their spending and efficiency strategies, fueling anxiety among U.S. tech professionals who now fear that their jobs and expertise could be at risk in the face of such disruptive advancements.
China's AI Models Are Gaining Momentum
According to the China Academy of Industrial Internet, the gap in AI model capabilities between China and leading global firms has narrowed by nearly 75 percent from the fourth quarter of 2023 to the first quarter of 2025. This trend suggests that DeepSeek's rise is not an isolated incident but part of a broader strategic advancement in China's AI sector.
The report also highlights shifts in global AI investment trends. China has secured the second-largest AI investment at $5.5 billion, while the United States leads with $64.1 billion. Although the U.S. maintains a significant lead in funding, China's substantial investments underscore its potential for future growth and influence in the global AI arena.
DeepSeek's ascent reflects a pivotal moment in the international AI landscape. As China's AI models gain traction, the dynamics of global tech competition are evolving, prompting industry leaders and policymakers to reassess strategies and priorities in this rapidly advancing field.
