Investors fear a $1 trillion loss as DeepSeek, a Chinese A.I. software company, rises in prominence, threatening the dominance of U.S. tech giants like OpenAI and Google. Nasdaq futures dropped nearly 4%, exemplified by Nvidia shares falling 11% due to concerns over the competitive landscape. DeepSeek's capabilities, achieved with fewer resources, compel a reassessment of the massive investments U.S. companies have made in A.I. The market turmoil indicates a potential shift in A.I. economics and competitive dynamics, particularly as DeepSeek undercuts existing prices and services.
Tech executives and policymakers have been left to wonder how strong America's lead in A.I. is as DeepSeek forces a reckoning in Silicon Valley.
DeepSeek's models rival those from OpenAI, Google, and Meta, made with a fraction of the resources that American competitors use.
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