Can Cheap Chinese AI Survive??

America's four biggest tech firms will spend $744b on AI this year. China's five biggest, $42.8b... a pretty crazy contrast.

Lets do the maths....thats 17/1.... And DeepSeek is pricing its models at roughly a seventy fifth of what the US charges.

The news media calls this a price war. I don't think it is. China isn't trying to sell intelligence. It's making it free so it can own everything that runs on top of it.

Reminds me of the Dutch, who spent 150 years burning nutmeg harvests to keep the price up. Right until someone smuggled seedlings out and planted them somewhere else. Monopoly gone. Not outcompeted, just no longer scarce.

Open weights are seedlings.

https://caffeinatedcaptial.substack.com/p/the-daily-morning-brew-peter-pepper