UK going for gold as China's AI chatbot has world talking

Last week, the booming US suffered the mother of all shocks as China produced a cheap alternative to the artificial intelligence (AI) technology that Americans have put so much faith in.

- By Harvey Jones

The release of Chinese AI chatbot DeepSeek stunned US tech experts by rivalling Microsoft's hugely popular ChatGPT at a fraction of the cost.

While Microsoft has ploughed a staggering $14billion (£11billion) into ChatGPT, DeepSeek cost a mere $5.6million, yet users reckon it's just as good. So far, the only obvious fault is that it blocks questions on awkward Chinese political topics such as Hong Kong, Tibet and Taiwan.

DeepSeek triggered the biggest one-day stock loss in US history, as AI chipmaker Nvidia's total market value crashed by 17% on Monday, wiping almost $600billion off its value. Its shares struggled to recover in what was a turbulent week.

It feels like a bullet aimed at the heart of AI hype, threatening the virtual monopoly the US has enjoyed in the groundbreaking tech, which drove tech stock valuations to unprecedented highs. If China can do the same job as the expensive tech giants for small change, the investment case for AI collapses.

TRUMPED

This would also be a huge blow for President Donald Trump, who plans a $500billion investment in AI and has pinned his administration success on US tech dominance. Trump labelled DeepSeek a "wake-up call" and urged US business to respond.

While the Nvidia share price continues to wobble as investors ponder the implications, DeepSeek was also a blow for pension savers, Stocks and Shares ISAs and retirees in drawdown.