Dive Brief:
- Chinese tech startup DeepSeek’s potentially game-changing artificial intelligence model launch is “very good news” for SAP, the enterprise software giant’s CFO said Tuesday.
- DeepSeek claims that its recently developed AI assistant was built at a low cost compared with U.S. rivals like ChatGPT. The startup’s sudden rise has sent shockwaves through the technology world and raised questions about America’s ability to maintain a position of AI dominance.
- SAP CFO Dominik Asam welcomed the development, saying the company is “agnostic” about the foundation models that are plugged into its platform. “The more supply, the more choice… the better for us,” he said in an interview on CNBC. “Competition, innovation on that front is extremely helpful for creating better products for our customers.”
Dive Insight:
Asam’s comments came on the same day that SAP announced its fourth quarter 2024 earnings results. The software provider’s total revenue grew 11% year-over-year during the quarter to $9.38 billion euros. Half of the company’s deals in the quarter were driven by AI, CEO Christian Klein said during an earnings call.
DeepSeek first released its open-source model in December, saying it took only two months and less than $6 million to build, according to a CNBC article.
That figure represents a small fraction of the hundreds of billions of dollars that U.S. tech giants such as OpenAI, Microsoft, and Meta have poured into developing their own models, the report said.
The latest version of DeepSeek’s AI model, released on Jan. 20, has soared to the top of Apple Store's downloads, surpassing ChatGPT, according to a BBC News article. U.S. tech stocks plunged on Monday in the wake of the development.
“The [DeepSeek AI model] release should be a wake-up call for our industries that we need to be laser-focused on competing to win,” President Donald Trump said Monday, speaking in Florida at House Republicans’ annual policy retreat.
Since returning to the White House, Trump has upended the U.S. approach to AI policy, placing a greater emphasis on protecting America’s ability to compete in the space against countries such as China.
