Why building big AIs costs billions – and how Chinese startup DeepSeek dramatically changed the calculus

DeepSeek burst on the scene – and may be bursting some bubbles. AP Photo/Andy Wong

State-of-the-art artificial intelligence systems like OpenAI’s ChatGPT, Google’s Gemini and Anthropic’s Claude have captured the public imagination by producing fluent text in multiple languages in response to user prompts. Those companies have also captured headlines with the huge sums they’ve invested to build ever more powerful models.

An AI startup from China, DeepSeek, has upset expectations about how much money is needed to build the latest and greatest AIs. In the process, they’ve cast doubt on the billions of dollars of investment by the big AI players.