DeepSeek, a Chinese artificial intelligence company, has launched a significant challenge to OpenAI’s market position by offering its AI models at substantially lower prices. The company’s latest model, DeepSeek-67B, is being offered at just $0.2 per million tokens for input and $0.6 per million tokens for output, marking a dramatic price difference compared to OpenAI’s GPT-4, which charges $10 per million tokens for input and $30 per million tokens for output. This aggressive pricing strategy represents a 98% discount compared to OpenAI’s rates. DeepSeek claims its model performs at 90% of GPT-4’s capability while costing significantly less. The company’s approach highlights the intensifying competition in the AI market, particularly from Chinese companies that are rapidly developing sophisticated AI models. This pricing strategy could potentially disrupt the current market dynamics and make advanced AI capabilities more accessible to a broader range of users and businesses. The development also signals a growing trend of Chinese AI companies becoming more competitive in the global market, potentially challenging the dominance of U.S.-based AI companies. The significant price difference raises questions about the sustainability of current AI pricing models and could force established players to reconsider their pricing strategies. This move by DeepSeek represents a notable shift in the AI landscape, potentially making advanced AI technology more democratically accessible.
Source: https://www.businessinsider.com/chinese-ai-lab-deepseek-massively-undercuts-openai-on-pricing-2025-1