DeepSeek made more than just a massive impact on the market on Monday. It is also dominating the app charts in recent days. I saw some articles suggesting that the drop in Nvidia's share price is the least of the Western world's worries. DeepSeek officially marks the entry of Chinese companies in the race for Artificial Intelligence dominance.
Not so fast. Take a look at this image which shows the countries with the most data centres. The US is 10 times bigger than number 2 on the list, Germany. The competition still has a lot of catching up to do.
Innovation in the field is surely welcome and if DeepSeek have managed to process more data with less infrastructure, than well done to them. Ever heard of Jevons Paradox? It means that the companies buying all these chips will use the extra efficiencies to add more capacity rather than spend less on infrastructure. Instead of slowing down the sales of chips, they may end up consuming more because they are getting better bang for their buck.