On the other hand, Chinese companies have chosen the open-source route as they compete with the more proprietary approach of U.S. firms, said Constellation Research's Wang. "They are hoping for faster adoption than the closed models of the U.S.," he added.
Speaking to CNBC's "Street Signs Asia" on Wednesday, Tim Wang, managing partner of tech-focused hedge fund Monolith Management, said that models from companies such as DeepSeek have been "great enablers and multipliers in China," demonstrating how things can be done with more limited resources.
According to Wang, open-source models have pushed down costs, opening doors for product innovation — something he says Chinese companies historically have been very good at.