- Tech giants are scrambling to respond to China's DeepSeek, a new AI model that has plunged the industry into turmoil.
- Sam Altman said OpenAI would accelerate the release of "better models" in response.
- Altman said OpenAI would keep stockpiling computing power, despite DeepSeek calling AI's chip spending spree into question.
DeepSeek has shaken Silicon Valley to its core — and now OpenAI is scrambling to respond.
CEO Sam Altman hailed the Chinese firm's low-cost AI model, which has stunned the tech world and caused upheaval in global markets, as "impressive" and said that OpenAI would accelerate the release of "better models" in response.
"DeepSeek's r1 is an impressive model, particularly around what they're able to deliver for the price," wrote Altman late on Monday in a post on X.
"We will obviously deliver much better models and also it's legit invigorating to have a new competitor! We will pull up some releases," the OpenAI boss added.
DeepSeek caused chaos in the global financial markets on Monday, with tech stocks plunging and Nvidia losing $589 billion in value as investors bet more efficient AI would mean lower demand for advanced chips.
Tech giants in the US are investing huge amounts in AI infrastructure as they race to build more powerful models.
Last week, Mark Zuckerberg said Meta would raise its spending on AI to $60-65 billion this year, and OpenAI teamed up with SoftBank to launch a $500 billion "Project Stargate" data center program at the White House.
But DeepSeek says it trained its R1 model, which has matched top AI reasoning models like OpenAI o1, on a $6 million budget and just 2,000 Nvidia H800 chips, calling trillions of AI infrastructure spending into question.
Despite the turmoil, Altman said he was still bullish about the importance of stockpiling massive amounts of computing power to build advanced AI models.
"(We) believe more compute is more important now than ever before to succeed at our mission," Altman said.
"The world is going to want to use a LOT of AI, and really be quite amazed by the next-gen models coming," he added.
OpenAI did not respond to a request for comment from Business Insider, sent outside normal US working hours.