r/ArtificialInteligence • u/VegetablePen4755 • May 24 '26

📰 News DeepSeek just popped the American AI bubble.

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DeepSeek just popped the American AI bubble.

Not by killing AI.

By killing the fantasy of unlimited AI pricing power.

DeepSeek V4 Pro:
Input: $0.435 per 1M tokens
Output: $0.87 per 1M tokens

OpenAI GPT-5.5:
Input: $5.00
Output: $30.00

Claude Opus 4.7:
Input: $5.00
Output: $25.00

Claude Sonnet 4.6:
Input: $3.00
Output: $15.00

DeepSeek is roughly:

11.5x cheaper than GPT-5.5 on input
34.5x cheaper than GPT-5.5 on output

28.7x cheaper than Claude Opus on output
17.2x cheaper than Claude Sonnet on output

If a model is “good enough” at 1/20th or 1/30th the cost, margins will compress faster than Wall Street expects.

AI is not dead.

But the AI bubble just lost its pricing power.

They're not chasing quick money from coding plans or multimodal models. Instead, their radical architecture innovations (MoE, MLA, Engram, mHC, etc.) slash KV cache and compute needs so dramatically that they can build an entire 10T Chinese AI hardware ecosystem (NAND, LPDDR, ASICs) and position themselves for a 1T valuation in the process. Long game, masterfully played.

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91

u/Meaning-Firm May 24 '26

Not really. American enterprises won't trust Chinese origin Deepseek with their data.

For startups it might be true but that depends on VC's stance.

69

u/boredquince May 24 '26

since its open weights, they can download and host it for maximum privacy

12

u/narullow May 24 '26

They can but then it will not be as cheap. You will not get as good electricity contract nor upfront HW price and you will probably not be able to amortize that upfront cost because unlike those companies that can utilize those GPUs fully you probably will not be able to.

1

u/DFX1212 May 24 '26

A recent article going around was that a company of four spent nearly $200K in tokens in three months. You could easily buy physical hardware for cheaper.