In response to competition from cheaper AI models, particularly from Chinese firm DeepSeek, Alphabet is significantly increasing its capital expenditures to $75 billion, a 42% rise, to enhance its AI capabilities. CEO Sundar Pichai praised DeepSeek's advancements but remains optimistic that falling AI usage costs will lead to increased demand for Alphabet's services, allowing the company to benefit from its vast user base. Meta also reaffirmed its commitment to AI investment amidst market uncertainties. The long-term impacts of this strategy on the tech landscape remain to be seen.
Alphabet CEO Sundar Pichai emphasized the enormous opportunities in AI, stating that declining usage costs will make diverse applications feasible and drive extraordinary use cases.
Despite the competitive landscape introduced by DeepSeek, Alphabet is significantly increasing its capital expenditures to accelerate its AI advancements and capitalize on the rise in inference.
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