\n<\/p>\n
The year began with a bang, as China\u2019s DeepSeek R1 large language model sent shock waves through Washington. Though experts still debate the extent to which it actually constituted a dreaded \u201cSputnik moment\u201d for U.S. artificial intelligence (AI), DeepSeek\u2019s debut nonetheless showcased capabilities rivaling those of U.S. leader OpenAI at a fraction of the cost and computing power.<\/p>\n
The release of the DeepSeek model also raised questions for U.S. policymakers about the effectiveness of Biden administration-era export controls on U.S. chips. Alarmed by the DeepSeek development, U.S. President Donald Trump\u2019s administration at first tightened control on sales of Nvidia chips to China. Building on this strategic pressure, White House AI and crypto czar David Sacks helped ink massive deals for the sale of advanced chips to the Middle East in May.<\/p>\n<\/p><\/div>\n
The year began with a bang, as China\u2019s DeepSeek R1 large language model sent shock waves through Washington. Though experts still debate the extent to which it actually constituted a dreaded \u201cSputnik moment\u201d for U.S. artificial intelligence (AI), DeepSeek\u2019s debut nonetheless showcased capabilities rivaling those of U.S. leader OpenAI at a fraction of the cost and computing power.<\/p>\n
The release of the DeepSeek model also raised questions for U.S. policymakers about the effectiveness of Biden administration-era export controls on U.S. chips. Alarmed by the DeepSeek development, U.S. President Donald Trump\u2019s administration at first tightened control on sales of Nvidia chips to China. Building on this strategic pressure, White House AI and crypto czar David Sacks helped ink massive deals for the sale of advanced chips to the Middle East in May.<\/p>\n
By the end of the year, though, Trump had decided restricting sales to Beijing for national security reasons<\/a> was less important than facilitating deals for U.S. businesses. Even as U.S.-China competition in AI continued unabated, the Trump administration this month granted Nvidia permission to begin selling its second-most-powerful chip to China.<\/p>\n The stunning turnaround in Washington\u2019s position may have been spurred by growing fears of an AI bubble. At year\u2019s end, the so-called Magnificent Seven tech companies comprised 37 percent<\/a> of the S&P 500 index; by 2029, global spending on AI infrastructure is expected to hit $2.8 trillion<\/a>.<\/p>\n Though investors\u2019 enthusiasms didn\u2019t dim, 2025 was also the year that international consumers and governments turned on U.S. tech platforms. Trump\u2019s \u201cAmerica First\u201d strategy led to a new wave of techno-nationalism<\/a> as governments worked to insulate themselves from the vulnerabilities of relying too heavily on either Washington or Beijing.<\/p>\n Geopolitical analyst Bobby Ghosh wrote<\/a> of the worldwide regulatory backlash, \u201cThis is how soft power dies: not in dramatic confrontation, but in the accumulated weight of betrayed trust.\u201d<\/p>\n These are our five best reads on the year profit beat out geopolitics in the AI race.<\/p>\n <\/p>\n By Rishi Iyengar and Lili Pike, May 5<\/em><\/p>\n In May, FP\u2019s Rishi Iyengar and Lili Pike looked into how the past eight years of U.S. restrictions on Chinese tech panned out and whether Washington should instead pursue a more collaborative approach with Beijing on AI development and regulation.<\/p>\n \u201cWashington\u2019s lack of plan for a future of AI parity with China is a concern,\u201d they write, citing experts\u2019 belief that a focus on restrictions has undermined further safety talks.<\/p>\n By Tobias Feakin and Adam Segal, June 4<\/em><\/p>\n The global technological landscape is entering a period of heighted competition, fragmentation, and uncertainty, write former Australian ambassador for cyber affairs Tobias Feakin and cybersecurity expert Adam Segal.<\/p>\n Feakin and Segal predict this will result in a surge in techno-nationalism as well as a more dangerous digital landscape. And while the United States may achieve short-term technological gains, they write, \u201cit will be unable to sustain long-term leadership with a broad coalition of allies and partners.\u201d<\/p>\n By Sam Winter-Levy and Alasdair Phillips-Robins, July 22<\/em><\/p>\n Two researchers at the Carnegie Endowment for International Peace outlined the case for export controls after Trump allowed Nvidia to resume sales of one of its best-selling AI chips to China in July.<\/p>\n \u201cRight as powerful AI reasoning systems are emerging, the administration has chosen to allow companies to sell China the chips suited to running them,\u201d Sam Winter-Levy and Alasdair Phillips-Robins write. \u201cExport controls\u2014for all their flaws\u2014were what helped the United States establish a significant edge in the computing power required to run and develop the world\u2019s most powerful AI systems.\u201d<\/p>\n By Bhaskar Chakravorti, Oct. 27<\/em><\/p>\n
\n1.\u00a0Is It Too Late to Slow China\u2019s AI Development<\/a>?<\/h3>\n
\n2.\u00a0Brave New Techno-Nationalist World<\/a><\/h3>\n
\n3.\u00a0The Nvidia Chip Deal Trades Away the United States\u2019 AI Advantage<\/a><\/h3>\n
\n4.\u00a0How to Make AI More Useful<\/a><\/h3>\n