DeepSeek – Game Changer or Game Over?

DeepSeek made waves by developing its R1 model for just $6 million - pocket change compared to what tech giants spent. While the open-source model impressed with its technical capabilities and low cost, it raised red flags about data security and privacy. This analysis weighs DeepSeek against ChatGPT and Microsoft Copilot, examining whether its benefits outweigh the risks for enterprise adoption.

While TikTok transformed how we share content online, DeepSeek is quietly reshaping how businesses interact with AI— and Silicon Valley didn't see it coming. DeepSeek is a Hangzhou-based startup that sent ripples through the American AI industry with its open-source reasoning model, the R1.

DeepSeek’s meteoric rise is mainly due to the company's claim to have developed its latest AI model for only $6 million, a fraction of the cost that Microsoft, Google, and Open AI invested in their programs. It is equally inexpensive to run queries against. In addition, they’ve open-sourced the model, meaning anyone can download it and run it themselves if they have the hardware to do so. The cost and open-source strategy captured the attention of businesses and developers worldwide.  

Unlike its Western counterparts, DeepSeek has leveraged existing AI frameworks while introducing innovative optimization techniques. Their R1 reasoning model directly challenges OpenAI's offerings, demonstrating capabilities that have impressed and concerned industry experts. 

Now that the initial buzz has settled, a more complex story emerges. While companies race to capitalize on AI's promise, critical questions lurk in the shadows: What does DeepSeek's open-source approach mean for enterprise AI adoption? How do organizations balance innovation with security? 

This analysis will cut through the hype to examine how DeepSeek compares to competitors like ChatGPT and Copilot, highlighting strategic advantages and potential vulnerabilities. We'll also provide guidance on best practices for safeguarding your business, ensuring you are well-prepared to protect your organization's data and interests as you integrate AI solutions.

Comparing DeepSeek, ChatGPT & Copilot: Which AI is Right for Your Organization?

AI chatbots have become the new gladiatorial arena, where tech giants battle not with swords but with algorithms and data, and only the most innovative will win the crowd’s favour. And for enterprise and tech leaders, choosing the right AI is about selecting the right model to champion their organization’s needs, while ensuring data security and compliance. With OpenAI's ChatGPT, Microsoft's Copilot, Claude Anthropic and Google's Gemini competing for attention, and now DeepSeek’s R-1, how do you determine which AI is best for your organization—and where DeepSeek fits in compared to these established industry leaders? That’s what we’re going to answer today. 

DeepSeek vs. ChatGPT 

DeepSeek R1 is a cost-efficient powerhouse, trained for just $6 million compared to GPT-4's $100 million price tag. While both DeepSeek and ChatGPT are conversational AI platforms, they don't share the same capabilities and excel in different areas. DeepSeek’s R1 model is built more for logical reasoning, mathematics, and problem-solving. ChatGPT is more of a general-purpose bot that can do a bit of everything. 

DeepSeek’s R-1 model excels in technical and complex tasks like coding and mathematical analysis. Reports state it can be up to twice as fast as ChatGPT in these areas. In addition, its free and highly affordable paid options make it very attractive to businesses and developers.  

While more expensive to implement, ChatGPT-4o (and now 3o!) offers broader capabilities that might better serve customer-facing operations, education, creative projects and content creation. It handles text, images, and voice with impressive speed (responding in just 320 milliseconds) and can manage up to 1,500 concurrent users without breaking a sweat. It also offers sophisticated conversational abilities and creative output, including storytelling and humour. 

Think of DeepSeek R1 as your specialized technical expert who's easy on the budget, while ChatGPT-4o is more like a versatile team player who can handle everything from customer service to creative tasks. Both models represent a significant leap forward in AI capabilities, making enterprise-grade AI more accessible.

DeepSeek vs. Copilot 

Microsoft Copilot offers two AI versions or tiers: Copilot and Copilot Pro. The standard Copilot includes the foundational AI capabilities, and Copilot Pro provides premium features and priority access to advanced models like GPT -4 Turbo. 

What truly sets Copilot apart is its seamless integration with Microsoft 365—a unique functionality compared to its competitors and especially advantageous for enterprise users. This integration enables teams to generate PowerPoint presentations from Word documents, analyze Excel data in real-time, draft contextually aware emails in Outlook, and enhance Teams meetings with AI-powered insights, all while maintaining enterprise-grade security standards. 

Copilot integrates seamlessly with Microsoft Office, giving it unique functionality compared to its competitors. When comparing DeepSeek and Microsoft Copilot, Copilot excels in general productivity tasks, offering real-time, consistent responses and efficient workflows. It can understand organizational context, analyze company documents and facilitate real-time collaboration across departments. As stated, DeepSeek shines in areas like coding and specialized technical queries, but it lacks the broader integration and user-friendly features required for large-scale business operations. 

However, the most significant advantage for organizations is the data protection and security you get with Microsoft Copilot. It automatically inherits the data policies you’ve set up in Microsoft 365, and organizational data is only displayed to users who are granted specific access and permissions. Prompts, responses, and data are encrypted when stored. They aren’t used to train language models, including those used by Microsoft 365 Copilot. 

Copilot’s flexibility and ability to support enterprise-level productivity make it a more reliable and scalable solution for organizations. It also proves to be slightly more useful for global and historical topics.

DeepSeek: Unpacking the Security Risks  

Regardless of which AI platform you use, privacy and security concerns will always cast a shadow, but DeepSeek faces heightened scrutiny for these concerns. Think TikTok-style concerns, but for business data. According to DeepSeek’s privacy policy, logging in through a third party may result in collecting information from that service and sharing your activities beyond DeepSeek, including on other websites.

They openly admit to sharing collected information with advertisers and analytics partners, and your data is retained "as long as necessary" to provide their services. Alarmingly, DeepSeek also logs your keystrokes and may never delete them. This means every word you type, along with your keystrokes' timing, duration, and speed, is recorded, creating a comprehensive digital fingerprint of your typing behaviour. Combined with other personal data, this paints an alarmingly detailed picture of your computer usage. If you request data deletion, you might be out of luck. DeepSeek retains user data "as long as necessary," with no defined time limit, and states that retention periods vary based on the type of information involved. 

Further concerns about data protection are heightened merely by DeepSeek stores its data on servers in China, with no clear indication of encryption or other protective measures against unauthorized access. This is a significant red flag for international organizations adhering to strict data protection policies. Additionally, DeepSeek’s governance under the People’s Republic of China laws raises questions about potential government access to sensitive data. Users have already reported censorship of specific topics, such as Tiananmen Square and Taiwan.  A separate test found that R1 refuses to answer 85% of prompts related to China, which could be a consequence of the government censorship to which AI models developed in the country are subject, unlike ChatGPT, which operates under stricter Western data protection frameworks and doesn't face the same censorship constraints. 

Although ChatGPT is not immune to security issues—as shown by a 2023 credential breach affecting 100,000 accounts—cybersecurity experts have raised concerns over DeepSeek's vulnerabilities. A cybersecurity firm reported that DeepSeek is easier to "jailbreak" or use for malicious purposes than ChatGPT, noting that "While DeepSeek R1 bears similarities to ChatGPT, it is significantly more vulnerable." This vulnerability was highlighted by a massive data leak that exposed sensitive records of over one million users just a week after its launch. 

For any organization handling sensitive information or teams requiring unrestricted discussions, these privacy and censorship considerations are not just footnotes but key security concerns for organizations integrating AI technology into their operations.

Key Security Considerations for Businesses 

AI adoption within organizations can become a double-edged sword. While the benefits of AI are undeniable, organizations must tread lightly due to potential vulnerabilities like data breaches, privacy threats, and the misuse of AI systems. As technology evolves, so do the challenges of navigating these various platforms. So, while the allure of being new and shiny is tempting, a security threat perpetually lurks in the background. And what are they?

Shadow AI 

One of the timeliest concerns for organizations is the emergence of "shadow AI". Like shadow IT, shadow AI refers to the unauthorized use of AI platforms within organizations. Employees using AI tools without IT or security knowledge can unknowingly expose their organization to risks like data leaks, compliance violations, and the exposure of sensitive information that could be detrimental to an organization. The platform's vulnerability to jailbreak techniques and prompt injections makes it particularly dangerous in an enterprise setting. Employees might unknowingly expose corporate data through seemingly innocent interactions with the AI program. 

Compliance

DeepSeek’s open-source model makes it more accessible, which may challenge compliance regulations within industries with strict data protection policies. Unlike Copilot, which benefits from Microsoft’s compliance frameworks and adherence to North American & European data protection policies, DeepSeek does not explicitly adhere to any global or national data protection laws. 

IP Theft & Trade Secrets Exposure 

Significant intellectual property concerns have been raised against DeepSeek and the AI industry. OpenAI has lodged serious accusations against DeepSeek, claiming unauthorized use of its technology to train its model through “distillation” – a development technique that boosts the performance of smaller models by using larger, more advanced ones to achieve similar results on specific tasks. This highlights broader concerns about IP protection and the risk of exposure to trade theft. 

US Government Policy Risk 

The parallels to TikTok’s regulatory ban are clear. What began as curiosity and excitement over a new chatbot quickly evolved into a national security concern when the U.S. Navy was instructed not to use the app in any capacity due to security and ethical concerns.  

This concern has prompted swift regulatory action, as hundreds of companies have already blocked access to the application. The U.S. Department of Justice is finalizing regulations that could restrict U.S. companies from engaging in "data transactions" with Chinese entities, thereby complicating the use of DeepSeek. Additionally, a bipartisan congressional bill aims to prohibit DeepSeek on government devices. The potential involvement of major Chinese social media players could invoke the "TikTok ban" statute, granting the authority to ban DeepSeek from the U.S. market.  

Moreover, the administration could leverage an 2019 Executive Order to enforce broader restrictions if DeepSeek is perceived as a national security threat. These developments pose significant legal risks for U.S. businesses using the app, possibly leading to its inclusion on the U.S. banned apps list alongside TikTok. This regulatory scrutiny is not confined to the U.S., as other nations closely monitor these actions, which might trigger a wave of international bans or restrictions.  

Why is Microsoft Embracing DeepSeek? 

Only a few days after DeepSeek’s big debut, Microsoft took a bold step. It announced that its R-1 is available on the Azure AI Foundry service, Microsoft’s platform combining several enterprise AI services under a single banner. In a blog post, Microsoft said that the version of R1 on Azure AI Foundry has “undergone rigorous red teaming and safety evaluations,” including “automated assessments of model behaviour and extensive security reviews to mitigate potential risks.” 

They added that in the future, customers could use “distilled” flavours of R1 to run locally on Copilot+ PCs, Microsoft’s brand of Windows hardware that meets specific AI readiness requirements. They conclude the post by saying, “As we continue expanding the model catalogue in Azure AI Foundry, we’re excited to see how developers and enterprises leverage DeepSeek R1 to tackle real-world challenges and deliver transformative experiences.” 

The move to add DeepSeek R-1 to their platform may raise eyebrows, given that Microsoft initiated a probe into DeepSeek’s potential abuse of its and OpenAI’s services. However, copycat or not, R-1 is all the rage, and Microsoft is eager to cement its position as the leader in AI. 

Microsoft enhances its cloud services offerings by adding DeepSeek to its technological portfolio while addressing customer demands for advanced AI tools. It also positions Azure as a versatile platform that meets the growing needs of businesses and developers seeking innovative solutions. It underscores Microsoft’s commitment to advancing AI technology and innovation at lower deployment costs.

Listen to Your Mother – Safety First! 

Just like mom used to say: "If something seems too good to be true, it probably is." While DeepSeek dazzles with its impressive capabilities and open-source allure, seasoned business leaders know that the newest, shiniest tool isn't always the safest choice. Some precautions are non-negotiable—like Mom teaching us to look both ways before crossing the street. Your organization's data security, reputation, and bottom line deserve the same care. Whether you're building customer service chatbots or streamlining operations, you need more than just 'new and shiny'—you need proven security frameworks and the strategic foundation that Copilot provides. If you're ready to embrace AI in your organization but want to do it safely and securely, we can help.