Consequences of Deepseek Outperforming OpenAI

A tiny Chinese startup called DeepSeek is now capable of releasing LLMs that are objectively better than the best AI models delivered by OpenAI. To further the insult, DeepSeek's models consumes 5% of the resources, in addition to that they only spent 5.6 million dollars on training their models. Still they outperform OpenAI's flagship models on most important parameters. DeepSeek basically runs in circles around GPT-4o, which is our standard model for "everything" we're doing.

Shifting the Balance of Power

This completely shifts the balance of power. Until 2 weeks ago, OpenAI, Anthropic, and Google Gemini, were officially uncontested as the champions of AI and LLMs. All of these were American companies. These companies spent billions of dollars on building their LLMs and hundreds of millions of dollars on compute for training. DeepSeek spent 5.6 millions, and probably less than 10 million dollars in total - And they're running around their American counterparts in circles. Needless to say, but this dramatically changes the balance of power

However, DeepSeek published their LLMs as open source. This implies that small startups such as AINIRO can download their models and run these on our own hardware. This implies again that Nvidia just got one million new potential customers for their GPUs.

Jensen Huang must be very happy with China today, even though he's from Taiwan himself

Peace in Taiwan?

The Chinese communist party have hinted towards that they'd be invading Taiwan within a decade. Ignoring the moral aspects of this, strategically it makes sense for them, because of Taiwan being the semi conductor "capital" of the world. With US creating export regulations preventing Chinese companies from accessing top notch GPUs, it simply makes sense for the Chinese from a "national security POV" to invade Taiwan, similarly to how you could argue it makes strategical sense for the US to invade Panama.

Then comes DeepSeek and creates LLMs that can run faster than ChatGPT and Claude, on hardware that's 10 years old - Arguably making the entire argument for invading Taiwan "obsolete".

Will this imply lasting peace in Taiwan? Actually, it might, because Taiwan is no longer "strategically important" to China ...

Independent Software Vendors are Winning

For us this is like x-mas eve, new years eve, and birthday at the same time. I already have DeepSeek 7B locally running on my system, and we'll probably have cloud solutions wrapping it in a month.

This makes AINIRO "a real AI company", because it allows us to host our own LLMs, and even fine tune it according to our needs - Without having to deal with 3rd parties like OpenAI. Basically, we're no longer co-dependent upon OpenAI and their world view, but can deliver whatever you need. In fact, we can deliver better AI than OpenAI, and we can do it with zero dollars.

Since the LLM was more or less 90% of OpenAI's "moat", this arguably makes us more valuable than OpenAI today - Because our "moat" is not tied to the LLM, but rather to Magic.

DeepSeek has basically made AINIRO more worth than OpenAI!

Wrapping up

I could dive deeper, and illustrate how this changes everything, including making the 500 billion dollars Donald Trump just announced for AI research more or less worthless. However, this changes everything. And for AINIRO it changes it to something better.

We're already in the process of incorporating DeepSeek into our own product, and within a month or two you can choose if you want to use OpenAI or DeepSeek, with DeepSeek being locally hosted by AINIRO. And we can deliver on-premise hosted LLMs for super sensitive solutions, where no data can leave the company's servers.

For us the future simply became a lot brighter, due to the most important shift in power it generated - Which is that the frikkin' thing is actually open source. For most others DeepSeek is a tragedy, including the entirety of Nasdaq top 100. But why should I care? What have Nasdaq done for me lately ...? 😉

It's not like as if I owe Nasdaq anything, right ...? 😂

Besides, it could be argued that OpenAI have rug-pulled thousands of companies themselves the last couple of years, it's only fair somebody rug pulls OpenAI for a change ...

However, ignoring the Karma aspects of things, this is literally the coolest thing we've seen in my industry since possibly the invention of the internet in general. The AI is smarter than your professor, and it's open source. The changes could not even in theory have been more pervasive, and I intend to exploit them at full capacity ...!!

Thank you DeepSeek, you're amazing. Continue doing great stuff! 😊

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