DeepSeek Shakes Up AI Market, Meta and Microsoft Remain Confident
DeepSeek, a Chinese AI company, has sparked market volatility by claiming that it can train AI models at a fraction of the cost of US tech giants. Nvidia (NVDA) shares plummeted over 17% on Monday, raising concerns about the potential for US companies to be outpaced by Chinese rivals.
Meta and Microsoft Respond
However, during their recent earnings calls, Meta (META) and Microsoft (MSFT) CEOs downplayed the threat posed by DeepSeek. They emphasized the benefits of continuous advancements in AI and acknowledged that DeepSeek's innovations could ultimately benefit their companies.
"AI will become more ubiquitous," said Satya Nadella, Microsoft's CEO. "This is all good news for us."
Mark Zuckerberg, Meta's CEO, stressed the industry's constant evolution and the need to embrace new developments. He expressed interest in incorporating some of DeepSeek's techniques into Meta's systems.
Analysts Question DeepSeek Claims
While some analysts have raised questions about DeepSeek's cost claims, others have questioned the use of distillation, a technique that involves using a larger model to train a smaller model.
Despite these concerns, DeepSeek's announcement has highlighted the potential for lower-cost AI training and the need for US tech companies to re-evaluate their AI infrastructure investments.
Meta and Microsoft Maintain Infrastructure Investments
Zuckerberg emphasized that Meta plans to continue investing in data centers to support the development of more accurate AI models and serve its large user base. Microsoft has also reiterated its commitment to its AI buildout, with plans to invest $80 billion by fiscal 2025.
Conclusion
DeepSeek's emergence has sparked industry introspection and a reassessment of AI development strategies. However, Meta and Microsoft remain confident in their long-term investments, believing that the benefits of robust AI infrastructure will outweigh the potential challenges posed by emerging competitors.