Chinese startup DeepSeek shook the AI landscape this week. Its open-source R1 model, which performs at a level comparable to OpenAI’s GPT-4o, was allegedly trained at just 3% to 5% of the total cost of competitors’ models. DeepSeek’s revelation rocked Big Tech markets and challenged the US’ AI leadership. Nvidia’s shares cratered by as much as 17% Monday, wiping out $595 billion in value before it started to rebound Tuesday. DeepSeek’s rise also drove brief stock selloffs in other US chip, energy, and infrastructure stocks.

DeepSeek’s potential to transform marketing comes with security considerations

DeepSeek can integrate with various marketing platforms, workflows, and tools to implement strategies across channels. It can also automate segmenting audiences using real-time data, ensuring that the segmentation remains relevant and up to date. Its AI, which is currently free to use, can analyze large data sets to identify patterns and trends in customer behavior, preferences, and demographics.

Affordable AI can level the playing field for marketers by allowing them to compete with larger agencies. However, DeepSeek presents considerable data privacy concerns, given that its customer data is hosted on servers in China. Its privacy policy states that it may share user information to “comply with applicable law, legal process, or government requests,” per Mashable. That caveat will mean AI companies that host their users’ data on US servers will continue to be more attractive to businesses even if their services come with fees.