GuShiio.com Image source: Generated by AI
The first wave of companies in China to announce that they would abandon DeepSeek has emerged.
Three days ago, DeepSeek officially announced that the theoretical cost profit margin of online systems reached 545%. Almost at the same time, Luchen Technology, a “Tsinghua Department” AI Infra company, suddenly announced the suspension of DeepSeek API access services.
While DeepSeek has increased GPU utilization to the extreme and many manufacturers have connected, Luchen Technology’s “reverse operation” is puzzling, and its founder You Yang’s remarks have been criticized by many netizens.
Sina Technology learned through Luchen Technology’s internal staff that “a large part of the reason for this adjustment is due to cost considerations.”
A number of investors and AI industry colleagues close to You Yang, the founder of Luchen Technology, revealed that “Although DeepSeek now open-source many inference components, it is difficult for third-party MaaS vendors to meet official costs, so they can only choose to suspend access.”
“The core of decommissioning is still the cost issue”
At 17:02 on March 1, just after DeepSeek announced that the theoretical cost profit margin of the online system reached 545%, which attracted widespread attention, Luchen Technology issued a document in official channels saying,”It will stop providing DeepSeek API services in one week, please use up your balance as soon as possible.”
Luchen Technology has not publicly mentioned why the company suddenly decided to stop providing DeepSeek API services. However, through the large amount of “Rational Analysis of DeepSeek Costs” released by Luchen Technology founder You Yang on Zhihu and other platforms after announcing the suspension of services, it can be basically concluded that cost issues are the key to deciding to abandon DeepSeek API service provision.
Sina Technology combed and found that in recent days, As the founder, You Yang has had many thoughts on DeepSeek, mainly focusing on the following three aspects:
1. DeepSeek’s latest data that the theoretical system cost profit margin reaches 545%, which is based on the fact that a large number of users completely overload DeepSeek’s apps and web pages. It is not a regular MaaS product. Because if conventional MaaS wants to achieve stable output, the number of machines that need to be prepared may be five times as large as theoretical.
2. DeepSeek is the best model company in China, but its products are often dropped. This is a fact.
3. DeepSeek’s paper shows that it takes only US$5.58 million to train a first-class large model. In fact, what is announced is the cost of one experiment, and developing a large model may require dozens of experiments. Zhongxiaoyun manufacturers should not rely on reselling DeepSeek API to lose money. Make money, and then boast that their reasoning is 10 times faster.
In You Yang’s public comments on DeepSeek,”high costs” pervaded throughout, so that these views are “opposed to DeepSeek” in the eyes of most netizens.
In communication with Sina Technology, many people close to You Yang said,”In fact, You Yang’s cost analysis of DeepSeek is aimed at discussing whether companies like Luchen Technology have a profit model as DeepSeek’s third-party MaaS product service provider?”
You Yang’s theoretical views first appeared in February. Shortly after DeepSeek’s release, You Yang publicly mentioned: “The training cost of DeepSeek’s related models is far from as low as rumored.” He calculated and pointed out,”If the full-blooded version of DeepSeek R1 outputs 100 billion tokens per day, the monthly machine cost would be 450 million yuan and a loss of 400 million yuan.”
The remarks and data at that time were publicly debated by Yuan Jinhui, founder of silicon-based mobility, who was also the founder of Tsinghua University AI Infra.
One of the people close to You Yang, M, bluntly said,”It is undeniable that the MaaS industry has indeed borne the losses of the entire industry. In fact, all major factories and model factories are losing money on their APIs. What really makes money is various cooperation, such as customized development or privatization.” In M’s view, Luchen Technology has suspended DeepSeek.”The core is the cost issue. Although DeepSeek now open-source many inference components, these may not be all, so it is difficult for third-party MaaS to meet official costs. Luchen Technology, as a small and medium-sized cloud MaaS organization that is also providing DeepSeek API service providers, is also facing a huge cost test, so they chose to suspend the service.”
Luchen Technology has not publicly explained why Luchen Technology has suspended DeepSeek API services. However, Sina Technology learned through the company’s user group that the company’s official explanation for suspending the DeepSeek API to users is: “Due to business adjustments, Lu Chenyun will suspend the MAAS API service this Friday night, and the unused balance can be refunded by contacting the small invoice assistant.”
Another Luchen Technology investor and company insiders also said that making such business adjustments was “mainly due to cost considerations.” The above-mentioned person reluctantly pointed out,”The essence is that the cost of providing stable DeepSeek services is too high and requires backup of a lot of redundant computing power resources. They can’t compete with large cloud vendors in this regard, so they can only give up.”
Advantages disappear, and small and medium-sized MaaS providers are “shivering”
According to incomplete statistics, hundreds of domestic companies have announced access to DeepSeek, covering popular fields such as technology Internet, cloud services, telecommunications, finance, energy, automobiles, and mobile phones, as well as government agencies across the country.
An investor in Luchen Technology believes that the cost of providing stable access services through DeepSeek is actually not low. “In theory, a single user will only consume underlying computing power when accessing DeepSeek model services, and will not consume resources at other times. However, when the number of users increases, the access time and frequency of different users are uncontrolled, which requires MaaS service providers to reserve enough redundant (backup) service resources. These resources are actually costs when not in use, and are often several times larger than the actual service resources.”
“It’s like when I bought a faucet from you. I may sometimes use too much water and sometimes use too little water. This is uncontrollable. You have to prepare some redundant water resources, not at the peak. During the period, I ran out of water.” The investor said,”As DeepSeek’s officially announced cost prices become lower and lower, if third-party MaaS vendors are unable to provide services that are close to or better than the official costs and performance, the room for profits from them will also be narrowed.”
The person pointed out,”Unlike small and medium-sized AI cloud manufacturers, large companies such as Alibaba Cloud and Tencent, on the one hand, they have more substantial reserves of capital and computing power resources, which can support the short-term losses caused by providing DeepSeek services; At the same time, they can also quickly attract and gather users through DeepSeek, and with users, they can make more monetization possibilities based on this.”
Interestingly, just after DeepSeek announced last week that it would release an open source series of codebases, entrepreneurs who also provided relevant API services based on DeepSeek publicly shouted in their circle of friends,”I can’t sleep today. The company’s good days are coming to an end!”
It shows that there are actually more than one small and medium-sized MaaS vendor affected by DeepSeek. As DeepSeek continues to promote the open source of a series of code bases, the technical barriers of a large number of third-party MaaS vendors are being broken. In the process of bringing technological benefits, DeepSeek is also subverting the business models of a large number of industry companies, allowing their products and services no longer have a competitive advantage.
