The emergence of Chinese AI startup DeeSeek upended Silicon Valley earlier this week, punching a massive $1 trillion hole through the tech industry. The company’s highly efficient yet high-performing “reasoning’ model, dubbed R1, suggested that Wall Street may be massively overspending on computing power to run its AI systems. Now it’s coming out that DeepSeek rattled employees at ChatGPT maker OpenAI so deeply that it’s causing a major rift among the company’s staff. As Wired reports, insiders are concerned that OpenAI could soon fall behind DeepSeek, at least in part due to a power struggle between the company’s research and product groups. While OpenAI’s latest o1 “reasoning” model — created by the research group — gets the most public attention, “leadership doesn’t care about chat,” one former employee who worked on chat told Wired. Another former OpenAI researcher added that DeepSeek did “similar” reinforcement learning for its own R1 reasoning model, “but they did it with better data and cleaner stack.” Put simply, OpenAI’s o1 model remained experimental, allowing DeepSeek to come out ahead. “It was like, ‘Why are we doing this in the experimental codebase, shouldn’t we do this in the main product research codebase?” one employee in the research told Wired. “There was major pushback to that internally.” The AI industry’s turmoil this week raised plenty of glaring questions: are investors really overpaying companies like OpenAI, which have been hellbent on scaling up their AI models’ abilities by spending vast sums of money on power-hungry datacenters? According to the Wall Street…OpenAI Staff Turn Guns on Each Other After DeepSeek Humiliation