From the New York Times, I'm Natalie Kittrow F. This is the Daily.

Last week, financial markets went into a panic over an obscure Chinese tech startup called Deepseek.

That company now threatens to upend the world of artificial intelligence and the race

for who will dominate it.

Today, my colleague Kevin Ruse, a tech columnist and the co-host of the podcast Hard Fork on

how Deepseek caught us all off guard.

Thank you. DeepSeek caught us all off guard. It's Monday, February 3rd.

Hi, Kevin.

Hello.

So great to be here.

So let's jump in.

Kevin, how did this giant AI tech freakout begin?

Tell us that story. So the freakout really started in earnest with a Chinese AI company called

Deepseek. And Deepseek had released a new AI model. You know, models are released all the time.

Generally, they don't make international news. But this model was different in a few ways.

Deepseek released its new chatbot app, which is said to perform as well as chat GPT.

One of them was that it just appeared to be a really good model, like better than the leading

Chinese models at the time and on par or close to on par with the leading American models.

A new AI king was crowned today, well at least for now.

And so the DeepSeek app, unseating open AI's chat GPT, goes to number one on the App Store charts.

It faults ahead of chat GPT in all these better known apps. Now, the most stunning thing

here isn't necessarily that China has developed a pretty good AI app. It's how cheap it is.

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