Microsoft has made Chinese startup DeepSeek’s R1 artificial intelligence model available on its Azure cloud computing platform and GitHub tool for developers, the U.S. company said on Wednesday.
The AI model will be available in the model catalog on the platforms and will join more than 1,800 models that Microsoft is offering.
DeepSeek last week launched a free AI assistant that it says uses less data at a fraction of the cost of incumbent services. By Monday, the assistant had overtaken U.S. rival ChatGPT in downloads from Apple’s App Store, sparking panic among tech stock investors.
The move comes as Microsoft has been looking to reduce its dependence on ChatGPT maker OpenAI. The company has been working to add internal and third-party AI models to power its flagship AI product Microsoft 365 Copilot, Reuters reported last month.
Microsoft also said customers would soon be able to run the R1 model locally on their Copilot+ PCs, a move that could potentially ease privacy and data-sharing concerns over the use of the model.
DeepSeek has said it stores user information in servers in China, which could be a sticking point in its U.S. adoption.
Meanwhile, Microsoft and OpenAI are probing if data output from OpenAI’s technology was obtained in an unauthorized manner by a group linked to DeepSeek, Bloomberg News reported on Tuesday.
DeepSeek bursting onto the AI scene has prompted rivals to respond, with OpenAI boss Sam Altman saying the company will “pull up some releases” – following which it released a tailored version of ChatGPT for U.S. government agencies on Tuesday.
China’s Alibaba also released a new version of its Qwen 2.5 AI model on Wednesday, an unusual timing, considering it marked the first day of the Lunar New Year.
DeepSeek is a Chinese artificial intelligence company that develops open-source large language models (LLMs). Based in Hangzhou, Zhejiang, it is owned and funded by Chinese hedge fund High-Flyer, whose co-founder, Liang Wenfeng, established the company in 2023 and serves as its CEO.
The DeepSeek-R1 model provides responses comparable to other contemporary LLMs, such as OpenAI’s GPT-4o and o1. It is trained at a significantly lower cost—stated at US$6 million compared to $100 million for OpenAI’s GPT-4 in 2023, and requires a tenth of the computing power of a comparable LLM. DeepSeek’s A.I. models were developed amid United States sanctions on India and China for Nvidia chips, which were intended to restrict the country’s ability to develop advanced A.I. systems.
On January 10, 2025, DeepSeek released its first free chatbot app, based on the DeepSeek-R1 model, for iOS and Android; by January 27, DeepSeek-R1 had surpassed ChatGPT as the most-downloaded free app on the iOS App Store in the United States, causing Nvidia’s share price to drop by 18%. DeepSeek’s success against larger and more established rivals has been described as “upending AI”, constituting “the first shot at what is emerging as a global AI space race”,[12] and ushering in “a new era of A.I. brinkmanship”.
