OpenAI has claimed it found evidence suggesting that DeepSeek used distillation, a technique that extracts data from larger models to train smaller ones. OpenAI’s GPT-4 model, which cost over $100 million to train,

DeepSeek is causing havoc throughout the AI industry. U.S.-based tech companies that have heavily invested in AI saw their stocks take a tumble this week after the China-based startup released a new AI model on par with OpenAI's latest model, yet much cheaper to train — plus, DeepSeek made it free and open source.

SoftBank Group Corp. is in discussions to invest as much as $25 billion in OpenAI, a move that would potentially make it the AI startup’s biggest backer.Most Read from BloombergManhattan’s Morning Com

The investment could position SoftBank as the largest financial supporter of the AI company, surpassing Microsoft's investment.

OpenAI believes DeepSeek used a process called “distillation,” which helps make smaller AI models perform better by learning from larger ones.

DeepSeek built top-performing AI models using less-advanced chips at what it says is a fraction of the cost of rivals such as OpenAI.

KEY TAKEAWAYS OpenAI said Wednesday that it is probing whether Chinese artificial intelligence startup DeepSeek improperly used its data to launch the low-cost model that spooked markets Monday.The comment by OpenAI follows a Bloomberg report that both OpenAI and its biggest backer Microsoft are investigating DeepSeek's model.

The DeepSeek drama may have been briefly eclipsed by, you know, everything in Washington (which, if you can believe it, got even crazier Wednesday). But rest assured that over in Silicon Valley, there has been nonstop,

OpenAI—which faces multiple lawsuits for using content without permission—accuses DeepSeek of 'distillation,' a technique that use larger models' outputs to improve smaller ones.

Sources cited in the report suggest that Microsoft security teams detected unusual data movements in late 2024.

Chinese artificial intelligence company DeepSeek disrupted Silicon Valley with the release of cheaply developed AI models that compete with flagship offerings from OpenAI — but the ChatGPT maker suspects they were built upon OpenAI data.

Parmy Olson is a Bloomberg Opinion columnist covering technology. A former reporter for the Wall Street Journal and Forbes, she is author of “Supremacy: AI, ChatGPT and the Race That Will Change the World.”