Trump Calls China’s AI Breakthrough a “Wake-Up Call” for US Tech Industry
US President Donald Trump has called the rise of China’s AI chatbot, DeepSeek, a “wake-up call” for America’s technology sector after the Chinese startup’s latest model, R1, surpassed OpenAI’s ChatGPT to become the most downloaded free app on Apple’s App Store.
DeepSeek’s rapid ascent has sent shockwaves through Silicon Valley, leading to a sharp selloff in tech stocks, with Nvidia alone losing $500 billion in market value.
Trump Urges US Tech Firms to Refocus on Innovation
Speaking at a Republican congressional retreat in Miami, Trump stressed the need for US tech companies to prioritize innovation to remain competitive. “The release of DeepSeek AI should serve as a wake-up call. We must stay laser-focused on competing to win,” he stated.
DeepSeek, a Hangzhou-based startup, has gained attention for developing AI models using cost-efficient methods. Its V3 model was trained on 2,000 Nvidia H800 chips for under $6 million, a stark contrast to US tech giants like OpenAI and Meta, which use the pricier H100 chips.
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The low-cost yet high-performance approach has raised questions about the effectiveness of US export controls on advanced chips, as Chinese firms continue to innovate despite restrictions.
While acknowledging the challenges posed by DeepSeek’s success, Trump also highlighted its potential benefits. “If you can achieve the same results for less, that’s a good thing,” he said, adding that the US would continue to lead in AI development.
Stock Market Turmoil and Cyberattacks
DeepSeek’s rise has had immediate global economic repercussions. On Monday, Nvidia’s shares plummeted, dragging down other major US tech companies, while Japan’s tech-focused stocks also experienced a sharp decline.
In contrast, markets in China, South Korea, and Taiwan were closed due to the Lunar New Year holiday.
Adding to the drama, DeepSeek reported a “large-scale malicious attack” on its platform the same day its app topped Apple’s App Store. The nature of the attack remains unclear, but the company assured users that its operations are secure.
China’s Growing AI Competitiveness
DeepSeek’s success highlights China’s increasing competitiveness in the global AI race, even under the constraints of US export controls. Founded in 2023, the startup has achieved remarkable progress, outperforming rivals with significantly fewer resources.
President Trump’s remarks underscore broader concerns in Washington about maintaining America’s technological dominance. The breakthrough by DeepSeek could signal a pivotal shift in the global AI landscape, as China demonstrates its ability to innovate under pressure.
