DeepSeek: Shoot First, Then Ask Questions
Monday’s NVIDIA ( NVDA 0.00%↑ ) selloff was interesting. Is NVIDIA overvalued? In my view, “Yes”. However, the idea that DeepSeek means less demand for Nvidia chips is wrong-headed.
DeepSeek poses a threat to expensive proprietary frontier models such as OpenAI’s model portfolio, Anthropic’s Claude family of models, and Google’s ( GOOG 0.00%↑ ) Gemini family of models. The same goes for smaller proprietary models built by Microsoft ( MSFT 0.00%↑ ), Amazon’s ( AMZN 0.00%↑ ) AWS unit, Mistral, Oracle ( ORCL 0.00%↑ )partner Cohere and others.
However, as models proliferate, the need for silicon will grow. Nvidia is not the only supplier. In addition to well known Nvidia competitors, do not lose sight of internal chip building operations such as Google’s TPU effort as well as start-up competitors such as Groq, which was founded by Google’s TPU founders, including CEO Jonathan Ross.