China’s DeepSeek that ‘shocked’ America and US technology companies reveals actual cost of training AI model

Chinese AI developer DeepSeek has revealed the cost of training its R1 model, a figure that is significantly lower than those reported by its US rivals. After launch, the DeepSeek R1 model stood out for its cost-efficient development and its open-source nature, offering unlimited free usage to a wide audience. Its emergence as a direct competitor to models from industry leaders such as OpenAI, Google, and Anthropic has brought new scrutiny to the financial investments required for AI development.

According to a report by Reuters, DeepSeek revealed that the company spent a significantly low amount—just $294,000—to train its R1 model. This figure was published in a peer-reviewed article in the academic journal Nature.