The early days of 2025 have made one thing clear in our industry: if you want to sell IT or any enterprise technologies, you have to know AI.
Artificial intelligence was already a dominant theme in 2024, but that was just a warmup lap. We’re not through January 2025 yet, and already we’ve seen Project Stargate and DeepSeek shake up the AI market. Stargate represents a $500 billion pledge from a handful of U.S. tech giants to invest in AI infrastructure. DeekSeek is new technology from China that claims to be well ahead of what U.S companies have been doing in AI for years.
DeepSeek was unknown in the U.S. before last week, but within a few days it replaced ChatGPT as the most downloaded app on the Apple store and trimmed half a trillion dollars from Nvidia’s valuation.
According to a research paper released last week by the Chinese startup, DeepSeek’s R1 large-language model (LLM) is more efficient and cheaper than OpenAI’s ChatGPT and other popular chatbots on the market. Plus, R1 is open source. However, it is far from a proven technology and people are discovering flaws.
It’s a great understatement to say DeepSeek has captured the tech industry’s attention. X has been buzzing with reaction. Tech investor Marc Andreesen called the DeepSeek AI model “one of the most amazing and impressive breakthroughs I’ve ever seen.” He added that it’s “a profound gift to the world.”
Microsoft CEO Satya Nadella claimed not to be worried about what DeepSeek can mean to ChatGPT, which Microsoft has invested in heavily. “As AI gets more efficient and accessible, we will see its use skyrocket, turning it into a commodity we just can’t get enough of,” Nadella wrote.
AT&T CEO John Stankey addressed DeepSeek on his company’s earnings call Monday.
“I would expect for a nascent technology like this, that we're going to have those moments because necessity is the mother of invention,” Stankey said. “And there's a lot of money, an awful lot of money and a lot of creative minds working on this and people are going to come up with better ways to apply it. And we're all going to have to stay on our game to make sure we use it effectively, so none of us are in a disadvantaged position relative to our competitors on cost structure effectiveness.”
Srini Koushik, Rackspace Technology’s president of AI, technology and sustainability, said “The next frontier for Enterprise AI lies in moving solutions out of the lab and into real-world applications at scale. Innovations like DeepSeek-R1 inspire a shift towards creating AI solutions that balance cutting-edge performance with practicality, enabling enterprises of all sizes to adopt and operationalize AI more effectively. This sets the stage for widespread transformation, empowering businesses to harness AI for smarter decision-making, enhanced productivity, and long-term competitiveness.”
Channel Implications of DeekSeek
What does it mean to the channel?
You know a technology is still relatively immature if a new release creates so much hype in one day. The jury is still out on how effective DeepSeek is, and no one is sure there isn’t something even better coming along right behind. Because it continues to change rapidly, AI presents opportunities and challenges for all types of organizations, and this is a great chance for channel partners to prove their value as trusted advisors. To take advantage, they need to know more about AI than their customers.
“I think one of the areas that's a challenge for everybody is just the confusion around what actually is AI, because now it's becoming a branding and marketing initiative,” said Brent Yax, CEO of MSP Awecomm Technologies. “Our clients ask, ‘What do I do? How do I do something with this? How can I take advantage of it? Is it right for me?’ Overall, it’s a huge opportunity.”
Another opportunity is with cost as DeepSeek can lead to a commoditization of LLMs. Anurag Agrawal, chief global analyst of Techaisle, said he has already been talking to channel partners about this.
“Many progressive partners are actually saying, ‘if I can start to use DeepSeek, it will probably bring down the cost of deployment and inferencing for my end customers, and which means that I can have a much better entry and a faster entry,’” Agrawal said.
“If you’re not really into AI, you should be,” he added. “If you don’t take advantage of AI today, you will be left far behind.”
Agrawal will present “AI Market Leadership: A Playbook for Scaling Success” March 25 at Channel Partners Conference and Expo, one of many AI sessions at the three-day conference in Las Vegas.