But Chinese startup shakeup doesn't herald 'drastic drop' in need for infrastructure buildout, say analysts

Analysis The shockwave following the release of competitive AI models from Chinese startup DeepSeek has led many to question the assumption that throwing ever more money at costly large-scale GPU-based infrastructure delivers the best results.

As The Register reported earlier, shares of some of the largest American tech brands in the AI boom tumbled following the debut of the DeepSeek R1 model, which is said to perform favorably against those from OpenAI and Meta and was trained using fewer Nvidia GPUs.

The China-based company's claims that DeepSeek's performance is on par with the best existing models and that it cost less than $6 million to train are also unverified

The move called into question the assumption that spending billions on datacenter infrastructure in a race to build larger and more complex models is the way forward if China can do this with limited supplies of older hardware. Nvidia ...