What the Rise of DeepSeek Tells Us About the Future of AI
DeepSeek has struck a powerful blow to the domestic artificial intelligence market. Following the release of its R1 model—the presumably cheaper, smarter version of ChatGPT—the company has challenged U.S. Big Tech with tumbling stocks while overtaking OpenAI in App Store downloads.
IT and business leaders might feel compelled to pivot their AI strategies. However, while the open-source model may offer short-term gains, the DeepSeek-R1 frenzy also holds valuable insights about AI’s long-term trajectory. Here are three key takeaways to consider before shifting your digital transformation plan.
1. Cost-efficiency will determine who controls the future of AI.
DeepSeek-R1 is operating at shockingly low costs. The company reports its models were trained at $5.6 million—a fraction of the amount spent on OpenAI’s GPT-4 and Google’s Gemini Ultra. Though the exact numbers have yet to be independently verified, DeepSeek’s technology is certainly disruptive enough to warrant Meta deploying a war room of engineers in response.
Businesses view this cost-effectiveness as a critical opportunity. DeepSeek-R1 is now offering its most-advanced features at less than 5% the price of OpenAI. Its exceptionally low cost per token—a segment of text that can be processed by artificial intelligence—promises to keep AI-based operations highly affordable.
But is DeepSeek-R1 right for your business? It depends. In our recent webinar, Capstone IT Solutions VP Glen Tindal affirmed cost will remain one of eight key factors affecting the value of AI models, especially as computing costs skyrocket. However, high-performing AI implementations don’t just save you money—they make you money by delivering top-quality outputs.
2. The quality of public AI data is out of your control.
Much like OpenAI o1, DeepSeek-R1 has turned heads by leveraging simulated reasoning, which mirrors a human-like chain of thoughts to improve results. Now, DeepSeek reports the AI model outperforms o1 in categories like math and software development—again, at a fraction of the cost.
Here’s one catch: Like other Chinese AI models, R1 has censorship baked into its training. One tech reporter notes that when prompted with questions about Tiananmen Square, Uyghurs, and the Taiwanese pro-democracy movement, the DeepSeek model responded, “I can’t reference external reports critical of China.”
Certainly, this censorship won’t affect all businesses, but it does demonstrate how the information generated by R1 will have both obvious and inconspicuous biases. AI is only as powerful as the data you feed it. Public AI can come with significant limitations, whether it’s censored data or unfiltered inputs from public internet sources and open records.
Businesses developing long-term AI strategies are not merely weighing the performance of DeepSeek vs. ChatGPT. They are also considering private AI models, which offer total control over their large language model’s training data. Companies can even securely input proprietary datasets for fully personalized outputs. With proper quality control and human oversight, private AI’s fine-tuned responses could deliver significantly more decision-making value than DeepSeek-R1 and o1.
3. Public AI poses significant cybersecurity and privacy risks.
Beyond the datasets, there are three critical reasons businesses should hesitate before leveraging DeepSeek-R1:
- Data Privacy: R1, like other public AI models, can capture your data for training purposes. WIRED also reports it appears to send data to Baidu, a Chinese tech company, and Volces, a Chinese internet infrastructure firm.
- Cybersecurity: After limiting registrations due to cyberattacks, DeepSeek has shown a questionable ability to secure the platform as it grows. This is especially the case after prompt injection vulnerabilities were discovered on the DeepSeek platform just one month earlier.
- National Security: Some experts warn that data collected by DeepSeek—which could include your IP address, operating system, and keystroke patterns—could contribute to cyber-espionage and zero-day exploit discovery.
Companies that choose to leverage DeepSeek (or any public AI platform) should be wary of inputting sensitive data like customer information. Doing so can put your compliance with data protection regulations into question, especially in the event of a breach.
Private AI continues to offer the safest alternative by ensuring all company data stays within your infrastructure—which your IT team can personally protect with custom access controls and security integrations. With regular security training across your organization, you can significantly limit vulnerabilities while getting customized results.
Strengthen Your AI Strategy with Private LLMs
While DeepSeek and OpenAI continue to dominate our news cycles, private AI presents an optimal path for future-proofing your infrastructure. R1, while outstandingly cost-efficient, raises significant data privacy, cybersecurity, and data quality concerns that cannot be overlooked.
At Capstone IT Solutions, we can equip your business with private AI solutions that meet your security needs—all while driving innovation with immense productivity gains and tailored results. Strengthen your AI capabilities, from intelligent automation to predictive analytics, without sacrificing control and efficiency.
Gain tailored private AI solutions that accelerate your goals. Connect with Capstone IT Solutions today.