I think it's more than just the market effect on "established" AI players like Nvidia.
I don't think it's necessarily a coincidence that DeepSeek dropped within a short time frame of the announcement of the AI investment initiative by the Trump administration.
The idea is to get the money from investors who want to earn a return. Lower capex is attractive to investors, and DS drops capex dramatically. It makes Chinese AI talent look like the smart, safe bet. Nothing like DS could happen in China unless the powers-that-be knew about it and got some level of control. I'm also willing to bet that this isn't the best they've got.
They're saying "we can deliver the same capabilities for far less, and we're not going to threaten you with a tariff for not complying".
I don't think it's necessarily a coincidence that DeepSeek dropped within a short time frame of the announcement of the AI investment initiative by the Trump administration.
The idea is to get the money from investors who want to earn a return. Lower capex is attractive to investors, and DS drops capex dramatically. It makes Chinese AI talent look like the smart, safe bet. Nothing like DS could happen in China unless the powers-that-be knew about it and got some level of control. I'm also willing to bet that this isn't the best they've got.
They're saying "we can deliver the same capabilities for far less, and we're not going to threaten you with a tariff for not complying".