A cellphone with the DeepSeek app
DeepSeek boasts performance comparable to or even superior to its American rival ChatGPT. Vuk Valcic/ZUMA

Updated January 28, 2025 at 11:30 a.m.*

Analysis-

PARIS — Following the sensation created by the emergence of ChatGPT, a Chinese state newspaper attempted to reassure its readers last year, who were impressed by the American breakthrough in artificial intelligence. “People need not worry excessively, as we are working to catch up with the Americans,” Global Times promised.

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Then in early January, a startup from Hangzhou launched China’s response to ChatGPT, called DeepSeek 3.The system boasts performance comparable to or even superior to its American rival, and notably costing just $6 million compared to the hundreds of millions spent on ChatGPT. It uses less sophisticated semiconductors and consumes far less energy.

But most notably, the Chinese company made a bold move by releasing its innovation as “open source,” meaning anyone around the world can copy the code and use it for free. This could undermine the ChatGPT model, which is becoming paid for its most advanced applications.

The startup’s latest model, released on the same day as U.S. President Donald Trump’s inauguration, actually dislodged ChatGPT at the top of Apple’s U.S. App Store’s most downloaded free app last weekend. This surge rocked Wall Street on Monday, with American tech stocks losing billions in value, and Trump calling it a “wake-up call” for the Silicon Valley.

This episode is revealing how artificial intelligence has become a decisive field of economic and geopolitical rivalry between the two superpowers of the 21st century.

Open source and competition 

Since Donald Trump’s first term, followed and amplified by Joe Biden, the United States has imposed technological sanctions on China. It has been denied access to the most advanced semiconductors, financing, and American technology, while Chinese tech companies have been blacklisted in the United States.

DeepSeek 3 shows that China has not had its last word.

These obstacles have certainly created problems, but they have also pushed China to develop its own technologies. Chinese President Xi Jinping has made this an absolute priority, investing enormous amounts of money into researching domestic solutions to reduce dependencies.

Paradoxically, this is the Chinese counterpart to “derisking,” the policy pursued by Europeans and Americans to reduce their reliance on China.

Ready to face rivalry from China?
Ready to face rivalry from China? – Worldcrunch screenshot

Sanctions and AI strategy 

This rivalry applies to all technological fields, as seen with the telecom equipment provider Huawei, for example; but artificial intelligence has a unique dimension. It is now at the heart of the technological transformation across all sectors, including defense: Tomorrow’s weapons will be filled with AI, making it a strategic issue.

Last month, Alex Karp, CEO of the American technology company Palantir, which is very active in the intelligence sector, stated that the “AI revolution” is “American.”

He said with a fair dose of arrogance: It’s ours. The companies are American. The money is American. There is no other place in the world to compete with us — not Europe, which is anemic and only thinks about regulation; not China or Russia. Who would want to start a business in those countries?

DeepSeek 3 shows that China has not had its last word, and while Silicon Valley, fueled by “Trumpism” tomorrow, may be more powerful than ever, it now has at least one competitor on the other side of the world. This rivalry will shape the 21st century, for better or for worse.

*Originally published Jan. 3, 2025, the article was updated January 28, 2025 with news about the Wall Street selloff of U.S. tech shares.