Source: SiliconANGLE
DeepSeek's move into chip design mirrors OpenAI's vertical integration strategy, but reflects a harder constraint: U.S. export controls on advanced semiconductors mean Chinese AI labs must develop alternatives to Nvidia's inference hardware or face operational bottlenecks as their models scale. This accelerates a split in the AI infrastructure stack. Winners won't just be model providers, but semiconductor vendors embedded in each geopolitical camp—the economics of custom silicon only work at scale, which means DeepSeek's success depends on capturing enough market share within China and allied nations to justify the R&D.