DeepSeek is reportedly taking ambitious steps towards the semiconductor sector, setting its sights on developing AI chips in-house to enhance its computing capabilities. This move positions them alongside OpenAI, who are also in the race to create proprietary AI chips, although it appears it might take some time before DeepSeek achieves this goal.
In recent months, DeepSeek has undergone a significant transformation, evolving from a “side project” into a formidable player in the global AI industry with its revolutionary LLM models. Competing head-to-head with OpenAI’s GPT o1, DeepSeek’s advancements are quite impressive, especially considering their previously challenged access to computing power—a claim they have since debunked.
Now, according to sources, DeepSeek is considering developing its own AI chips, aligning with other major AI firms pursuing similar strategies. While the details of these chip projects remain scant, it’s clear the company has embarked on an aggressive recruitment campaign, actively seeking semiconductor experts to spearhead this venture. However, this endeavor is far from straightforward. Producing an AI chip demands a complex supply chain, and Chinese companies face additional hurdles due to global sanctions. Currently, they can only rely on limited chip-making resources such as SMIC, which still lags behind global technological standards.
Currently, DeepSeek wields around 10,000 of NVIDIA’s “China-specific” H800 AI GPUs and another 10,000 high-end H100 AI chips, amassing around $1 billion in computing assets. Despite facing US trade restrictions, DeepSeek remains resilient, maintaining equipment on par with its competitors. Additionally, they use Huawei’s Ascend AI chips for other processing tasks, boasting a versatile range of computing resources.
The proposition of DeepSeek venturing into in-house chip production raises some eyebrows, particularly because the company hasn’t reached the same scale as giants like OpenAI. However, this bold move could infuse much-needed diversity into the AI market. The pivotal question remains whether DeepSeek can manage to transition from planning to implementing its chip-making ambitions.
