Deepseek and other Chinese models are close enough for most typical use cases.
This could seriously wreck our entire economy, so much of the stock market is propped up by AI hype.
Anyway, expect a massive government bailout for Anthropic and Open AI when the Chinese models prove to be more cost efficient.
Might not be next year, or even this decade, but it’s coming.
PS: A fear mongering campaign is already underway, Deepseek is going to give you communist code completion!
Then in a corporate environment, were most tokens will be spend, you have security concerns, you also might want to go with one company over the other due to partnerships etc.
If USA is blocking chinese companies/models (which they already partially did), big companies will just not bother and use US AMerican models.
Also running it yourself is often not relevant. You don't want to know how much money my company spends on software products which could easily be replicated internally.
But running models yourself might be something you don't have expertise with, you need GPU ready DC, hardware, a new/diffferent team, quality assurances etc.
And Chinese models are known to leverage frontiermodels for post-training results.
Don't get me wrong, I don't want to say chinese models can't disrupt the market massivly absolut possible, but its not given just because they are cheaper.
Absolutely nothing stops Microsoft/Amazon/Open Router( with partners) from hosting the Chinese models. As far as I can tell this is already the case.
This establishes a defacto price cap on what Anthropic and Open AI can charge. If you’re a heavy user blowing past 400$ a month self hosting becomes economical. A Mac Studio with 128GB of ram is about 6k.
Every day local tools are getting better, the OSX ecosystem here is exceptional.
You do have a point with frontier models, but most of the time you don’t need frontier models.
If I knew for sure I’d short Anthropic and retire early.
Self hosting is still far away from what Anthropic and co offers. A Mac Studio with 128GB doesn't deliver the speed at all. If you burn through $400 a month, you also might get a lot more value out of it so you don't care paying a premium.
We will see though. I think its not that easy to tell.
And what absolutely crazy is that I used 2.4B tokens this month and it cost me $1.7 (w/ 99.4% cache hit) of my $10 sub
for most NON-ENTERPRISE use cases.
You need to get your head checked if you are sending any valuable IP to the Chinese LLMs.
I wonder just how valuable intellectual property is going to be in the AI era.
Nothing makes American companies inherently more trustworthy here.
Anthropic has an Indian office, you have no assurance your IP isn't going to end up being seen by some T1 tech support making 8$ an hour.
https://www.anthropic.com/news/bengaluru-office-partnerships...
But if you told me that you'd give me 20k, but only for shorts or calls I'd probably short a variety of AI related stocks.
I also think Europe is going to become increasingly wary of American tech, but this could take well over a decade if we're talking about a movement to keep European data in Europe.