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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="546" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-820x546.jpeg" alt="" class="wp-image-580429" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-820x546.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-768x511.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-1536x1022.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/108043098-1727989387640-gettyimages-2173579499-META_CONNECT-scaled.jpeg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Mark Zuckerberg, CEO of Meta Platforms Inc., arrives for the Meta Connect event in Menlo Park, California, on Sept. 25, 2024. David Paul Morris | Bloomberg | Getty Images</figcaption></figure>



Meta CEO Mark Zuckerberg on Wednesday said it’s too early to tell what impact DeepSeek’s breakthrough AI model will have on his company and the broader tech industry. 



Still, Zuckerberg poured cold water on the notion that Meta’s overall AI spending will soon drop now that DeepSeek has allegedly proven that cutting-edge AI requires far less money and computing resources than previously thought.



“It’s probably too early to really have a strong opinion on what this means for the trajectory around infrastructure and CapEx,” Zuckerberg said. “There are a bunch of trends that are happening here all at once.”



The technology markets were reeling this week over an AI model created by DeepSeek, which is a Hangzhou-based AI lab linked to the Chinese hedge fund High-Flyer. DeepSeek claims it only took two months and less than $6 million to develop its R1 large language model. That news caused Nvidia shares to tank 17% on Monday because of the implications that companies don’t need as many of the chip-maker’s graphics processing units for their own artificial-intelligence projects.



Zuckerberg discussed DeepSeek during a call with analysts Wednesday as part of Meta’s fourth-quarter earnings. The company reported that sales rose 21% year over year to $48.39 billion, ahead of Wall Street expectations.



Meta’s shares rose nearly 2% on Monday, indicating some investors believe DeepSeek’s cost-efficiency could mean the social media company may be able to create powerful AI systems for less money. Meta announced last week plans to invest between $60 billion and $65 billion this year as part of its AI push. The company on Wednesday said its 2025 total expenses would come in between $114 billion to $119 billion.



Zuckerberg said Meta is still digesting some of DeepSeek’s feats and his team hopes to eventually implement some of those advancements for their own AI projects.



“That’s part of the nature of how this works, whether it’s a Chinese competitor or not,” Zuckerberg said, referring to how one company’s advances end up benefiting others.



While it’s possible that companies will eventually require less computing resources to train these powerful models, Zuckerberg said that having a ton of server power may be necessary when the software is actually running and performing actions, resulting in “a higher level of intelligence and a higher quality of service.”



“It’s going to be expensive for us to serve all of these people because we are serving a lot of people,” said Zuckerberg, whose company said it had 3.35 billion daily active people in the fourth quarter.



Meta will continue to learn from technologies like DeepSeek’s and release its own open source and free Llama AI models that can also push the industry, Zuckerberg said.



“I continue to think that investing very heavily in CapEx and infra is going to be a strategic advantage over time,” he said. “It’s possible that we’ll learn otherwise at some point, but I just think it’s way too early to call that, and at this point, I would bet that the ability to build out that kind of infrastructure is going to be a major advantage.”



Zuckerberg also said that DeepSeek’s emergence validates Meta’s commitment to an open-source approach to AI, Zuckerberg said.



“There’s going to be an open-source standard globally,” he said. “For our own national advantage, it’s important that it’s an American standard.”

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="562" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-820x562.jpg" alt="" class="wp-image-579752" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-820x562.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-300x206.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-131x90.jpg 131w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-768x526.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-1536x1053.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/01/GettyImages-2196255677-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">SAN ANSELMO, CALIFORNIA &#8211; JANUARY 27: In this photo illustration, the DeepSeek app is displayed on an iPhone screen on January 27, 2025 in San Anselmo, California. Newly launched Chinese AI app DeepSeek has surged to number one in Apple&#8217;s App Store and has triggered a sell-off of U.S. tech stocks over concerns that Chinese companies&#8217; AI advances could threaten the bottom line of tech giants in the United States and Europe. (Photo Illustration by Justin Sullivan/Getty Images)</figcaption></figure>



Chinese artificial intelligence startup DeepSeek could face curbs from the U.S. government as it upends the U.S. AI ecosystem, though enforcing restrictions on an open-source technology could be a challenge, experts said.



DeepSeek’s sudden rise has questioned the effectiveness of Washington’s efforts aimed at curbing China’s access to high-end tech over national security concerns.



For DeepSeek, which relied heavily on open-source code, the additional export restrictions that the U.S. government could impose are limited, said Lawrence Ward, a partner at U.S.-based law firm Dorsey &amp; Whitney with a specialization in national security law.



In terms of the company’s potential use of certain Nvidia chips, it might face civil and criminal penalties, but enforcing those penalties may be “difficult if not impossible,” Ward said.



On Monday, the U.S. lawmakers called for actions to slow down the Chinese tech startup, with some calling DeepSeek “a serious threat.”



There are no easy solutions to restrict the use of an open-source model, especially one that is being widely tested and used by organizations and individuals, said Paul Triolo, partner at Albright Stone Group.



One option would be for the Commerce Department to craft rules that require tech giants such as Apple and Google to take down DeepSeek’s app, restricting its downloads in the U.S. market, Triolo said, adding that it would, however, be challenging to pull the app off other platforms such as Github.



DeepSeek in December released a free, open-source large language model, which it claimed was built in just two months and at a fraction of the cost borne by other major players. Last week, the company released a reasoning model that reportedly outperformed OpenAI’s latest offerings in many third-party tests.



DeepSeek, whose AI chatbot has become the most downloaded free application on Apple’s App Store in the U.S., said it created the model despite the sweeping controls imposed in 2022 by the U.S. on China’s access to the most advanced Nvidia chips.



The Hangzhou-based startup said it used the less-advanced Nvidia H800 chips to build the model, which was available until the U.S. government widened the ban in October 2023.



“If DeepSeek had equipment that it shouldn’t have, it could certainly lead to further investigation,” said Daniel Newman, CEO of Futurum Group, who expects the U.S. government to look into DeepSeek’s hardware which might have violated export curbs.



U.S. President Donald Trump said Monday that the advancement of Chinese AI app DeepSeek “should be a wake-up call” for America’s tech companies, while lauding the low-cost model as “very much a positive development” for AI overall. “Instead of spending billions and billions, you’ll spend less, and you’ll come up with, hopefully, the same solution,” Trump said. 



DeepSeek’s claimed cost efficiency and effectiveness of its model sent U.S. tech stocks into a tailspin as investors questioned the amount of money big tech firms have been investing in AI models and data centers. U.S. companies could now leverage the public codes to refine their own models and possibly bring down computation costs.



Rep. John Moolenaar, R-Mich., the chair of the House Select Committee on China, said on Monday the U.S. government should work to place stronger export controls on technologies critical to DeepSeek’s AI infrastructure.



“The situation is somewhat unprecedented, and it is not likely that anyone in Washington has a clear idea what to do about it &#8230; we are clearly in uncharted waters at many levels,” Triolo said.



The company said on Monday that it temporarily limited new sign-ups to users with mainland China’s phone numbers following a large-scale malicious cyberattack that caused outages on its website.



On Jan. 20, the day when the the company’s R1 reasoning model was launched to the public, DeepSeek’s founder Liang Wenfeng attended a closed-door symposium for businessman and experts, chaired by Chinese premier Li Qiang, according to state media Xinhua.



CNBC’s Dylan Butts, Hui Jie Lim contributed to this report.

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Why Mercedes Has A Better Driver Assist System Than Tesla’s Autopilot

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