Will DeepSeek disrupt American AI’s first-mover advantage?
Marketplace Tech
American Public Media
4.6 • 1.2K Ratings
🗓️ 13 February 2025
⏱️ 7 minutes
🧾️ Download transcript
Summary
There’s a concept in business called the first-mover advantage. Basically, it means that if you’re the first company with a successful product in a new market, you have the opportunity to dominate the market and fend off rivals. But that advantage can be short-lived. Take Netscape Navigator, the first popular commercial web browser. Microsoft entered the field with Internet Explorer, and it wasn’t long before Navigator crashed. In AI chatbots, two of the first movers are OpenAI and Anthropic. But recently the Chinese company DeepSeek made a splash with an AI chatbot that it reportedly developed for a fraction of what its competitors have spent. Marketplace’s Stephanie Hughes spoke with historian Margaret O’Mara, author of the book “The Code: Silicon Valley and the Remaking of America,” about whether America’s artificial intelligence industry should be worried about newcomers like DeepSeek.
Transcript
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| 0:00.0 | It's nice to be first. Doesn't mean you'll win. |
| 0:04.3 | From American Public Media, this is Marketplace Tech. I'm Stephanie Hughes. |
| 0:17.4 | There's this concept in business called First Mover Advantage, basically when you're the first |
| 0:22.4 | company to a new market to get your product broadly adopted. The advantage can be short-lived. |
| 0:27.8 | Take Netscape, which was one of the very first commercial internet browsers, but ultimately |
| 0:31.7 | was discontinued. In the world of AI chatbots, some of the big first movers are open AI and anthropic. |
| 0:38.5 | But then, the Chinese company Deep Sea leased a new version of its AI chatbot a few weeks ago, |
| 0:44.0 | which it reportedly developed for a fraction of the cost of its competitors. |
| 0:48.1 | Historian Margaret O'Mara is author of the book The Code, Silicon Valley and the Remaking of America. |
| 0:53.8 | She says this reminds her of another |
| 0:55.6 | time in tech history. There's this dimension of foreign competition also brings to mind the late |
| 1:01.9 | 70s and early 80s and the U.S. semiconductor industry that was suddenly freshly challenged by advanced |
| 1:07.6 | chips coming out of Japan, which was kind of a surprise where Japanese chipmakers |
| 1:13.2 | were taking some technologies developed in the United States to develop complex chip making |
| 1:18.0 | and assisted by subsidies from the Japanese government came to market and were able to rapidly |
| 1:23.3 | undercut American chip makers on price and really had Silicon Valley on the ropes for a few years |
| 1:29.4 | in the early 1980s with this very fierce competition. So the Deep Seek saga brings to mind another, |
| 1:36.7 | this earlier geopolitical moment, and I think there are some interesting similarities. |
| 1:41.4 | It's way too early to make any pronouncements on where companies like OpenAI |
| 1:45.2 | will land after this, but it does raise the specter of companies like Netscape and Frenster, |
| 1:51.4 | who were sort of first but certainly didn't last forever. What factors could determine if |
| 1:56.3 | American AI companies go the way of Frenster or if they can enjoy their first mover advantage? What I'm watching is, you know, go the way of Friendster or if they can enjoy their first-mover advantage? |
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