Chinese startup In depth sent shock waves via the financial markets on Monday on the affirmations that he could develop advanced artificial intelligence models using much cheaper semiconductors than this did not think.
These implications have sent actions to NvidiaA flea manufacturer whose value has increased in recent years on the promises of fueling the AI revolution, down two -digit while the markets opened for the week.
Other technological actions also took a blow on Monday while investors attacked the emergence of the new player could mean for the future of the AI industry.
“This company may not be the winner at the end of the day, but she led many people to question the model that had been the wait a few weeks ago,” said Greg Taylor, Director of investments at Publicy Investments, told Global News.
The S&P 500 fell 1.8% in afternoon trading and heading for its worst day in more than a month. Big Tech Stocks took some of the heaviest losses, with Nvidia down 17.4%, and they dragged the Nasdaq composite down 3.5%.
The S&P / TSX composite, the Canada reference index, was down approximately one percent to 2 p.m. in the east.
The wave of activity turned on Monday around Deepseek and its AI assistant, which, from Monday morning, had disbuised Openai as a free application from top to bottom on the Apple App Store Tables to the States -Unis.
The startup Deepseek was founded in 2023 in Hangzhou, China, and published its first large language model of AI later that year. His CEO Liang Wenfeng had previously co-founded one of the best hedge funds Chinese, High-Flyer, which focuses on the IA quantitative trade.
The startup indicates that its applications are tied with the types of advanced AI models that feed popular chatbots such as the Silicon Valley Openai Chatppt.
They are also cheaper to use. The Deepseek-R1, published last week, is 20 to 50 times cheaper to use than the OpenAi O1 model, according to the task, according to an article on the official WeChat account of Deepseek.
This progress is particularly notable because the United States has prohibited the exports to China from the most advanced IA fleas, such as the last semiconductors of Nvidia. Some have expressed skepticism that Deepseek was able to make such progress on the back of nvidia older generation technology.
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If a Chinese startup has been able to reproduce the work of American companies on the back of cheaper less sophisticated fleas, this could have generalized implications for the future of automatic learning and the so-called AI arms race.
Valerie Wirtschafter, member of foreign policy and artificial intelligence at Brookings Institute, told Global News that Deepseek’s emergence could represent a “Sputnik moment” for the United States, where the Americans thought they had Domination in an emerging field, only to be surprised by the innovation of a foreign rival, the launch of Russia of the Stellite Spoutnik in 1957.
“At least in the United States, thought was that, if we prevented China from having the material, the fleas to process this information, they will not be able to compete with the United States in terms of development of these large models of language, “she said.
“I think the incentives not to sell China fleas really worked against the United States because they have innovated. So they were able to do more with less. »»
Why do other AS AI tech actions take a hit?
AA Actions took a blow on Monday because Deepseek’s claims, if they hold it back up the idea that the key to success in AI pompred money in fleas and infrastructure more expensive such as advanced data centers.
The main American players recently doubled this approach with the announcement of the Stargate project – 500 billion US dollars by spending more than four years aimed at strengthening US AI with the support of the second administration of President Donald Trump .
If similar progress can be made with more affordable fleas, however, the business model could change considerably.
Maura Grossman, IT professor at the University of Waterloo, told Global News that there will always be a need for Nvidia chips, but his reputation for a must for IA software developers could be in danger with the ‘Emergence of Deepseek.
“It is as if you sell shovels during the gold rush and now no one needs shovels – spoons work,” she said. “And what do you arrive if you sell the shovels?”
Grossman notes that if companies can obtain the same production of AI with technologies less with a high intensity of resources, this could have a positive environmental impact, because the high -end data centers which feed artificial intelligence applications have Significant requests for critical electricity, water and minerals.
Taylor says that the current moment recalls the dot-com bubble in the millennial turn, when companies such as Nortel and JDS rushed to install as many fiber optic cables as possible to meet the requests for networking other companies.
“And then suddenly, we woke up one day and said,” We have many more fibers than we will never need. And all these companies have just crashed. And I think this is the parallel that some investors make this morning, ”explains Taylor.
“This is the big awakening that we have at the moment. And I think that is why the market has tripped a little. »»
Taylor notes that it was never realistic for Nvidia to have a share of “win-win” of the ia flea market. He suggests that part of the media threw around AI on the market could start to move away from flea manufacturers like Nvidia to users – software companies such as Apple that develop applications.
Wirtschafter and Grossman both say that in -depth developments could feed even more request for AI chips, because the obstacles to the entry are lower for companies that wish to start building this infrastructure.
Until now, it was prohibitive to enter the AI game without significant capital available in advance. The more expensive it is to get involved, the more competition could happen to the AI industry.
“There will always be a need for their tokens,” says Grossman. “Perhaps not at the same frantic level that it has been so far, especially if people are starting to find ways to do the same quality work with lower fleas.”
Taylor says one of the biggest questions in the future is how Trump will react. The AI was one of the sectors it was the most lively to defend within the framework of its banner focused on America, says Taylor, and any threat perceived for this industrial domination could cause a rapid response in the US-Chinese-Chinese commercial relationship.
Shape prices, as Trump threatened to handle Canada, Mexico and China already during the first week of his second presidential term, could play a role in the American response to Deepseek, suggests Taylor.
– With Nathaniel Dove files from Global News, Reuters and the Associated Press
