Microsoft Corporation and OpenAI are currently investigating individuals linked to Chinese AI startup DeepSeek for allegedly obtaining data from OpenAI’s models without authorization, 9am News Nigeria has learned.
Microsoft security researchers observed that individuals believed to be affiliated with DeepSeek accessed a substantial amount of data through OpenAI’s application programming interface (API) in late 2024. The API allows developers to license OpenAI’s proprietary AI models for integration into their applications. However, Microsoft, a major investor in OpenAI, flagged DeepSeek’s activities as potentially violating OpenAI’s terms of service.
A Bloomberg report revealed that OpenAI is examining whether DeepSeek used a technique known as “AI distillation”—a method that involves training a new model based on outputs from an existing AI system.
David Sacks, the AI czar under President Donald Trump, stated that there is “substantial evidence” that DeepSeek leveraged OpenAI’s models to develop its own AI technology. Speaking to Fox News, Sacks explained that AI distillation allows companies to replicate the capabilities of proprietary AI models without direct access to their underlying architecture.
“There is convincing evidence that what DeepSeek did here is they extracted knowledge from OpenAI models, and I don’t think OpenAI is very happy about this,” Sacks added.
Although OpenAI has not issued a direct statement on the allegations, the company acknowledged ongoing threats from competitors. A spokesperson noted that Chinese-based AI companies continuously attempt to replicate models from top US firms.
“We are aware that several Chinese companies are actively working to imitate our AI models. As the industry leader, we are collaborating with the US government to ensure our most advanced AI technologies remain protected,” OpenAI said.
DeepSeek’s Rise and Market Impact
DeepSeek recently introduced DeepSeek-R1, an open-source AI model reportedly capable of competing with models from OpenAI, Google, and Meta. The model was developed at a fraction of the cost usually required for high-performance AI systems.
Also, DeepSeek’s rapid rise and claims of AI superiority have unsettled Silicon Valley, raising concerns over intellectual property theft and China’s ability to bypass US restrictions on AI advancements. On Monday, leading AI-related firms—including Microsoft, Nvidia, Oracle, and Alphabet (Google’s parent company)—collectively lost approximately $1 trillion in market value following DeepSeek’s shocking entry into the AI race.
Furthermore, The investigation by OpenAI and Microsoft could have major implications for global AI regulation, competition, and intellectual property enforcement.
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