DeepSeek, a Chinese artificial intelligence company, has emerged as a formidable player in the tech world by developing an AI chatbot that claims to be significantly cheaper to develop than its counterparts. This breakthrough achievement not only challenges existing industry norms but also ignites debates regarding the veracity of DeepSeek's claims. The announcement has sent ripples through the AI industry, raising questions about the future of AI development and its economic implications.
The advent of DeepSeek's innovation coincides with a period of heightened creativity among Chinese tech firms, driven in part by stringent US export controls. These regulations have compelled companies to explore new pathways and develop unique technologies to maintain competitiveness on the global stage. In response to DeepSeek's announcement, Microsoft's CEO described this development as "good news" for the widespread adoption of AI technologies, suggesting it might democratize access to powerful AI tools.
The AI industry has been abuzz since OpenAI introduced ChatGPT, which sparked a surge in technology stocks and propelled Nvidia into the position of a multitrillion-dollar industry leader. Nvidia's hardware has long been considered indispensable for developing sophisticated AI models. However, DeepSeek's recent claim suggests that there are other viable pathways to achieving similar results without relying solely on Nvidia's costly technology. This revelation could potentially alter the landscape of AI development, challenging prevailing assumptions and causing a recalibration of investment strategies within the sector.
"There is a big trend of reducing the size of the AI model," one engineer remarked, highlighting a growing focus on optimizing AI models for efficiency and cost-effectiveness.
"Over time, there will be many ways to achieve this," the engineer added, suggesting that DeepSeek's approach is just one of many innovative solutions on the horizon.
Beyond DeepSeek's groundbreaking achievement, SoftBank is making significant strides in the AI sector by investing heavily in startups with a focus on AI technologies. Notably, SoftBank is channeling resources into Skild, a company dedicated to creating a scalable foundation model for robotics. With over $300 million in funding secured and SoftBank founder Masayoshi Son endorsing the investment, Skild is poised to make significant advancements in the field.
Amidst these developments, Skild is also exploring the creation of a "China-free" supply chain for critical minerals, including rare-earth elements essential for advanced technologies. Southeast Australia's Victoria region has been identified as a promising source for these mineral sands, which can be processed to extract rare-earth elements. Two projects in Victoria have recently passed environmental assessments, paving the way for further exploration and development.
However, this progress comes with its own set of challenges. Shenghe Resources, a Chinese rare-earth company, has entered into an agreement to purchase 60 percent of the output from one of the Victoria projects. This deal raises concerns about China's continued influence over the global supply chain for rare-earth elements, which are crucial for numerous high-tech applications.
The implications of DeepSeek's advancements extend beyond technological boundaries, potentially puncturing the bubble of bullish spending within the AI industry. The company's approach may inspire others to explore alternative methods for developing robust AI models without incurring exorbitant costs. As such, this could lead to more sustainable growth trajectories in AI research and development.
In parallel, SoftBank's involvement in Skild and its ongoing discussions to lead a new funding round underscore the increasing interest in AI-driven innovations. Should these discussions materialize, Skild's valuation could soar to nearly $4 billion, signaling strong investor confidence in its potential to revolutionize robotics and related fields.