Donald Trump calls DeepSeek AI ‘good’, gives advice to US companies: ‘Focus on…’

US President Donald Trump has responded to the DeepSeek panic in the US markets, calling the Chinese AI app 'positive' and a wake-up call for the US industry. In particular, DeepSeek's recently launched R1 and V3 models had helped the app leapfrog OpenAI's ChatGPT to the number one spot in Apple's App Store rankings in various countries, news agencies reported.

Speaking to a Republican congressional retreat in Miami, Trump said, “Hopefully, the release of DeepSeek AI from a Chinese company should be a wake-up call for our industries that we need to be laser-focused on competing to win.”

"I would say that could be a positive… So instead of spending billions and billions, you'll spend less, and you'll come up with hopefully the same solution," Trump said.

What is DeepSeek?

DeepSeek is a Chinese AI company founded in 2023 by Liang Wenfeng, who is also the head of the Chinese quant hedge fund High-Flyer. The company shot to fame last month after various benchmarks showed that its V3 large language model (LLM) outperformed those of many popular US tech giants, while being developed at a much lower cost.

DeepSeek's R1 language model, which mimics aspects of human reasoning, also matched and outperformed OpenAI's latest O1 model in various benchmarks.

Why is US worried about DeepSeek?

DeepSeek's large language models are built at a much lower cost, challenging the conventional wisdom that running AI models requires ever-increasing amounts of computing power.

In a paper last month, DeepSeek researchers stated that the V3 model leveraged the older Nvidia H800 chips for training and incurred a cost of around $5.6 million, a miserly sum compared to the billions that AI giants like Microsoft, Meta and OpenAI have committed to spend this year alone.

The success of DeepSeek has also called into question the effectiveness of export restrictions on advanced AI chips, a policy introduced by the Biden administration to slow the growth of artificial intelligence in its adversarial countries.

DeepSeek's low-cost AI is also expected to threaten the market share of established AI companies like OpenAI, Meta and Google, while also leading to a potential drop in price.