ChatGPT Maker Suspects China’s Dirt Cheap DeepSeek AI Models Were Built Using OpenAI Data — and the Irony Is Not Lost on the Internet

OpenAI has voiced concerns that China's DeepSeek AI models, known for their low cost, may have been developed using OpenAI's data. This has prompted a strong reaction, with Donald Trump calling DeepSeek a wake-up call for the U.S. tech industry following a significant drop in Nvidia's market value—a loss of nearly $600 billion. The emergence of DeepSeek triggered a sharp decline in the stock prices of major AI-focused companies. Nvidia, a dominant player in the GPU market crucial for AI model operation, experienced the most dramatic fall, with a 16.86% drop—the largest single-day loss in Wall Street history. Microsoft, Meta, Alphabet, and Dell Technologies also saw significant decreases in their share values.

DeepSeek promotes its R1 model as a significantly cheaper alternative to Western AI offerings like ChatGPT. Built upon the open-source DeepSeek-V3, it reportedly requires far less computing power and had an estimated training cost of just $6 million. Although this claim has been disputed, it has fueled concerns about the massive investments made by American tech companies in AI, unsettling investors. DeepSeek's popularity further surged, reaching the top of the U.S. free app download charts amidst growing discussions about its capabilities.

Bloomberg reported that OpenAI and Microsoft are investigating whether DeepSeek leveraged OpenAI's API to integrate OpenAI's AI models into its own. OpenAI acknowledged that Chinese companies, and others, consistently attempt to extract data from leading U.S. AI companies through distillation, a technique violating OpenAI's terms of service. OpenAI emphasized its commitment to protecting its intellectual property and collaborating with the U.S. government to safeguard its technology.

David Sacks, President Trump's AI czar, indicated substantial evidence suggests DeepSeek used distillation to extract knowledge from OpenAI models. He anticipates countermeasures from leading AI companies to prevent similar actions in the future.

The situation highlights a significant irony, given OpenAI itself has faced accusations of using copyrighted material without permission in the creation of ChatGPT. Ed Zitron, a tech PR writer, pointed out this hypocrisy on Twitter.

OpenAI previously stated in a submission to the UK's House of Lords that training AI models like ChatGPT without copyrighted material is impossible due to the broad scope of current copyright laws. This stance aligns with their response to lawsuits from the New York Times and 17 authors, who allege the unlawful use of their work in OpenAI's and Microsoft's products. OpenAI maintains that its training practices constitute "fair use." The complexities surrounding copyright in the context of AI training are further underscored by a 2018 U.S. Copyright Office finding that AI-generated art cannot be copyrighted.