Chinese state institutions rapidly adopt DeepSeek
DeepSeek is helping the state modernize.
This week, several media outlets have reported that government bodies and state-owned enterprises (SOEs) are rapidly jumping on the DeepSeek bandwagon.
Some context: Chinese state adoption of LLMs was previously hampered by the fact that the best LLMs were either foreign controlled or closed source.
- That made genAI adoption either an expensive or risky proposition for state-affiliated institutions.
But no longer: According to multiple media reports, entities across the private and public sector are deploying DeepSeek-powered tools, including:
- Major cloud service providers
- Automakers
- Local governments
- State-owned enterprises (SOEs) in the energy sector
The bigger picture: For over a decade, Xi has been trying to horsewhip central SOEs into being more innovative and adopting cutting-edge digital technologies, with abysmal results.
- In 2022, only 4.5% of SOE execs surveyed said that internal digital transformation efforts were "meeting expectations."
- 60% said their enterprises were in the early stages of transformation, with digitization impacting only an isolated business unit or process.
A relatively unrestricted, inexpensive, and domestically produced tool like DeepSeek will almost certainly boost those efforts.
But but but: SOEs can't simply jump from low levels of digitization to highly effective AI implementation.
- This will benefit the SOEs that have strong digital teams and thus know how to use these tools.