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In this photo illustration, a DeepSeek logo is seen displayed on a smartphone with a South Korea Flag in the background.
South Korea halts downloads of DeepSeek
South Korea’s Personal Information Protection Commission, the data privacy authority in the country, said the app “lacked transparency about third-party data transfers and potentially collected excessive personal information.” It’s unclear whether the third party in question is the Chinese government.
The government said the ban will only be lifted after DeepSeek adheres to the country’s privacy and security laws, which are considered among the world’s most stringent. While DeepSeek’s R1 model has quickly become one of the foremost large language models, it’s the first such one to hail from China — and thus, privacy advocates and global regulators have criticized its privacy policy, which states that the company will share data with China. “We store the information we collect in secure servers located in the People's Republic of China,” the policy says. The Chinese Foreign Ministry urged South Korea not to “politicize” trade issues and said Chinese companies comply with local laws where they operate.
Italy already banned DeepSeek nationwide over privacy concerns, while Taiwan and Australia each banned the app on government devices. In the United States, there’s no federal prohibition on government devices, but legislation was introduced earlier this month to do just that. Meanwhile, New York, North Carolina, Texas, and Virginia have all banned DeepSeek on state-owned devices.
Software is difficult to ban — especially since virtual private networks can mask one’s location — but countries concerned by Chinese access to their citizens’ data are trying their best.
DeepSeek logo seen on a cell phone.
First US DeepSeek ban could be on the horizon
Lawmakers in the US House of Representatives want to ban DeepSeek’s AI models from federal devices.
Reps. Josh Gottheimer and Darin LaHood, a Democrat from New Jersey and a Republican from Illinois, respectively, introduced a bill on Thursday called the “No DeepSeek on Government Devices Act.” It would work similarly to the ban of TikTok on federal devices, which was signed into law by President Joe Biden in December 2022. Both bans apply to all government-owned electronics, including phones and computers.
DeepSeek’s R1 large language model is a powerful alternative to the top models from Anthropic, Google, Meta, and OpenAI — the first Chinese model to take the AI world by storm. But its privacy policy indicates that it can send user data to China Mobile, a Chinese state-owned telecom company that’s sanctioned in the US.
Since DeepSeek shot to fame in January, Australia and Taiwan have blocked access on government devices; Italy has banned it nationwide for citizens on privacy grounds. Congress may go further and try to ban DeepSeek in the United States, but so far no members have proposed doing that.
Is DeepSeek the next US national security threat?
Before DeepSeek released its R1 model last month, America’s long-term AI dominance felt like a sure thing.
DeepSeek is a Chinese startup, born from a hedge fund, that claims to have used a fraction of the computing power of US competitors while making an artificial intelligence model that rivals the best that Northern California’s labs have to offer. Critics have alleged that the company has been dishonest about claims it only spent $6 million training the model. But for anyone taking DeepSeek at face value, it has been a revelation that sent shockwaves not only through Silicon Valley but also through Wall Street and Washington.
The Biden administration spent the past few years clamping down on powerful US-made chips flowing into China, but evidently, DeepSeek figured out how to build a great model with a dearth of high-tech resources.
“It shines a spotlight on the limits of the US export control system,” said Xiaomeng Lu, geo-technology director of Eurasia Group. “Technology has evolved in a way that regulators failed to anticipate.”
“Necessity is the mother of invention” – that’s how Jack Corrigan of Georgetown’s Center for Security and Emerging Technology put it. “US efforts to hobble China’s AI sector created a need for Chinese developers to innovate a more efficient approach to AI.”
But DeepSeek’s impact goes beyond its own efficiency. It’s an open-source model, meaning its code is available for anyone to use and modify. “Due to the open-source nature of their model, it will be much harder to restrict access to it entirely,” said Valerie Wirtschafter, a fellow at the Brookings Institution. “The other more pragmatic question is whether Congress has the appetite for more whack-a-mole-style tech regulations, given the chaos that has unfolded since the passage of the TikTok ban.”
US government agencies such as NASA and the Navy have banned DeepSeek models on their devices, as did Congress, but there’s been no US effort to try and ban it more widely among the public, as Italy did on Thursday, citing unresolved data privacy concerns. And America’s top cloud providers, including Microsoft Azure and Amazon Web Services, have already added access to R1.
Justin Sherman, founder of Global Cyber Strategies, says that the Trump administration has a toolbox to “screen, restrict, and even expel non-US tech from the US tech supply chain on national security grounds,” particularly through the Commerce Department’s Information and Communications Technology and Services. Still, he cautions against letting “stock market temperaments, reductive China panic in Washington, and media overinflation of industry AI claims” steer nuanced policy decisions.
DeepSeek’s true threat is likely strategic rather than technical. “DeepSeek’s latest model raises the question of what happens if China becomes the leader in providing publicly available, freely downloadable AI models,” said Sam Winter-Levy, a fellow at the Carnegie Endowment for International Peace. “While the US is obsessed with the race to see who can build the single biggest and most powerful model, perhaps even artificial general intelligence, the Chinese might win the race to see who can build really useful and cost-effective models that will be used by people and companies around the world.” At a minimum, China’s overnight success has quickly leveled the playing field for US-China competition over technology.
Perhaps then the answer to DeepSeek requires a rethinking of what American dominance in AI really means. Banning any specific app or model would just be a Band-Aid on a bullet wound.
DeepSeek puts US-China relations on edge
Ian Bremmer shares his insights on global politics this week on World In :60.
How is China's AI app DeepSeek disrupting the AI industry?
It certainly seems to be making people concerned that the Chinese are a lot closer to the Americans and the Trump administration is not sleeping on this. They clearly feel that China is technologically very capable, very advanced. Frankly, different than Biden felt when he first became president, though he got up to speed on that pretty quickly. And I think that's going to lead to a much tougher competition between the United States and China. Those that think that a deal is coming, that Trump is going to engage with China because he wants to find a way to not have to put tariffs on, I don't think that's going to happen because you're going to have so much more efforts to contain the Chinese in all sorts of areas of advanced technology broadly speaking.
They are way ahead in data. The Americans are ahead in compute, and they're both going to lean into the opportunities that they have. And the Americans are going to use their firepower from a government perspective with other countries around the world as well. That's what I think.
Trump has issued a 90-day pause on nearly all US foreign aid. What's the likelihood it'll be extended beyond that?
I don't know how long it's going to be extended, but I do know that so many of the contractors that are involved, for example, USAID, which is like half of their capable workforce, are gone. And within 30 days they then lose their security clearances and they're not going to have capability to execute. So I think there will be permanent damage to the ability of the Americans to actually get a lot of development programs done around the world, and this is an important piece of US soft power.
And if the Americans aren't doing it, other countries around the world will, most particularly China,. This is an opportunity for the Chinese to have more influence, especially in the Global South than the United States. And this is pennywise and pound foolish for the Americans. And unlike the suspension of domestic support and funding and programs, which led to a whole bunch of outrage and then the order was rescinded, on foreign aid there's not a lot of domestic outrage. And companies don't want to stick their necks out because they think that they're going to get whacked hard by the Trump administration. So, I think it's more likely to have a longer-term impact.
What do I make of the Rwandan-backed rebels' advancements in Congo?
Definitely it is expanding the civil war. A lot of Congolese are really unhappy that this is happening with the support of external actors. You've seen a bunch of embassies in Congo ransacked, a lot of riots as a consequence, and not a lot of interest in trying to resolve the problem other than from folks like the United Nations who are pretty weak on the ground. So like we're seeing in Sudan, in Congo, an expanding civil war that is causing a lot of humanitarian hardship and havoc. That's it for me, and I'll talk to you all real soon.
This illustration photo shows the DeepSeek AI application logo on a black background displayed on a cell phone with a kaleidoscope-effect China flag in the background.
What DeepSeek means for the US-China AI war
A Chinese startup might have achieved what many thought was impossible: matching America’s best artificial intelligence systems at a fraction of the cost.
DeepSeek's latest AI model, DeepSeek-R1, was released earlier this month. The open-source model performs as well as top models from OpenAI and Google while using just a fraction of the computing power and cost to develop; it’s also a fraction of the cost to use.
DeepSeek claims that it only needed $6 million in computing power to develop the model, which the New York Times notes is 10 times less than what Meta spent on its model. The R1 model received the fourth-highest score on Chatbot Arena, which crowd-sources evaluations to rank large language models by capability, only behind two of Google’s Gemini models and ChatGPT-4o and ahead of Anthropic’s Claude 3.5 Sonnet.
If you take DeepSeek at its word, then China has managed to put a major player in AI on the map without access to top chips from US companies like Nvidia and AMD — at least those released in the past two years. Joe Biden’s administration placed strict export controls on these chips, so if the company has had access it may not be forthright about that.
For now, the US markets are indeed taking DeepSeek at its word. Nvidia stock fell nearly 17% on Monday, erasing a record sum from its market capitalization — $589 billion in a single day. The Nasdaq stock exchange ended the day down 3%, as a result.
The revelation about DeepSeek has come as Donald Trump tries to spur AI infrastructure in the United States, heralding the $500 billion Stargate project. But China’s new open-source model might have just changed the landscape when many thought the United States was running away with the race.
In a speech Monday evening, Trump called news of the DeepSeek model a “positive” due to its cheap cost but said American industry needs to compete. “The release of DeepSeek, AI from a Chinese company should be a wakeup call for our industries that we need to be laser-focused on competing to win.”What Stargate means for Donald Trump, OpenAI, and Silicon Valley
In his first week back in office, Donald Trump gathered tech leaders Tuesday to announce a half-trillion-dollar project called Stargate.
Flanked by OpenAI CEO Sam Altman, Oracle chairman Larry Ellison, and SoftBank CEO Masayoshi Son, Trump announced a $500 billion private investment in artificial intelligence infrastructure that he said is “a resounding declaration of confidence in America’s potential.” SoftBank’s Son called it the “beginning of a golden age” of AI in the United States.
While Trump heralded the announcement from the White House, Stargate is a privately funded joint venture. The new entity is backed by OpenAI, SoftBank, and Oracle, but also MGX, an Abu Dhabi-based investment firm. Microsoft and chipmakers Arm and Nvidia were named “technology partners” for Stargate. The purpose: to build massive data centers across America to spur the increased demand for AI.
The flashy price tag caught plenty of attention, but Stargate also has spurred controversies about Trump’s relationship with Silicon Valley and raised questions about the value of energy-guzzling data centers in the age of AI.
Elon Musk scoffs at Stargate
Within hours of the announcement, the Stargate announcement sparked criticism from Elon Musk, who has been a major funder of Trump’s presidential campaign and adviser to him in the White House. Musk, who runs xAI, a rival firm to Altman’s OpenAI, claimed on social media that “they don’t have the money.” He went on to say that he has it on “good authority” that SoftBank has less than $10 billion secured for the project.
Altman refuted this in a response to Musk. “Wrong, as you surely know,” he wrote on X. “This is great for the country. I realize what is great for the country isn’t always what’s optimal for your companies, but in your new role I hope you’ll mostly put America first.”
Musk’s critique may have been rooted in jealousy. Stargate appears to primarily benefit one company: OpenAI. “Even if the Stargate infrastructure is made available to other AI developers, OpenAI could potentially use its ‘operational responsibility’ to tilt the playing field in its favor,” said Jack Corrigan, a senior research analyst at Georgetown’s Center for Security and Emerging Technology.
Should Trump get credit for Stargate?
The public spat between Silicon Valley’s top CEOs-turned-lobbyists was only one controversy that emerged from this announcement. News outlets reported that the Stargate deal was in the works for months before Trump took office and that an Oracle data center complex in Abilene, Texas, highlighted during the event, was already under construction as of this past summer.
“This project was started well before the Trump administration,” said Scott Bade, a geo-technology analyst at Eurasia Group. “It was really more about branding it with the White House imprimatur than Trump playing a real role.” He said Trump is happy to take credit for Stargate even if there aren’t federal dollars supporting it.
How much energy will Stargate need?
There are open questions about how to power all of this new infrastructure. AI systems require enormous amounts of energy, and the Stargate project will require an estimated 15 gigawatts across sites, according to Morgan Stanley. It’s unclear what the energy mix will be, but the first site in Abilene will rely on natural gas.
While the Biden administration pushed for clean energy sources — even backing the use of nuclear energy — Trump has signaled his openness to relying on fossil fuels for data centers. Perhaps the most likely outcome is there’s no cop on the beat pushing data center developers and AI companies toward renewable and clean energy sources, pushing us closer toward an energy crisis at a time when Goldman Sachs estimates AI will drive data center power demand 160% by 2030.
“Building data centers for AI without considering their environmental impact to nearby communities could cause massive shortages of various finite resources, especially in Texas where the first Oracle data centers are being built,” said Gadjo Sevilla, senior analyst at eMarketer.
The DeepSeek question
Stargate is built on the assumption that to train and run powerful AI models developers need access to powerful chips running in high-tech data centers that can support them.
But the recent emergence of DeepSeek, a Chinese AI startup claiming it’s developed a top large language model without access to top Nvidia chips or extensive data center infrastructure, has raised questions about the importance of such a massive scale in developing and deploying AI.
If DeepSeek is telling the truth about its breakthrough, that could throw Stargate’s entire premise out the door and reset the AI market entirely. Suddenly, AI demand for data centers could fall through the floor.