DeeperML

China's multi-billion-dollar AI infrastructure boom is now facing a significant downturn, according to a new report. The rush to build AI datacenters, fueled by the rise of generative AI and encouraged by government incentives, has resulted in billions of dollars in idle infrastructure. Many newly built facilities are now sitting empty, with some reports indicating that up to 80% of China’s new computing resources remain unused.

The "DeepSeek Effect" is a major factor in this reversal. DeepSeek's AI models, particularly the Deepseek v3, have demonstrated impressive efficiency in training, reducing the demand for large-scale datacenter deployments. Smaller players are abandoning plans to pretrain large models because DeepSeek’s open-source models match ChatGPT-level performance at a fraction of the cost, leading to a collapse in demand for training infrastructure just as new facilities were ready to come online.

ImgSrc: www.aiwire.net

References :

• AIwire: Report: China’s Race to Build AI Datacenters Has Hit a Wall
• AI News: DeepSeek disruption: Chinese AI innovation narrows global technology divide
• Sify: DeepSeek’s AI Revolution: Creating an Entire AI Ecosystem
• www.tomshardware.com: China's AI data center boom goes bust: Rush leaves billions of dollars in idle infrastructure

Classification:

• HashTags: #DeepSeek #ChinaAI #AIInfrastructure
• Company: DeepSeek
• Target: AI Infrastructure
• Product: DeepSeek
• Feature: Model efficiency
• Type: AI
• Severity: Informative