DeepSeek Upends Silicon Valley’s Sci-Fin-Fi Business Model
Radhika Desai · International Critical Thought · 2025
Commentary on DeepSeek’s release of its R1 model fails to capture three critical points: just how decisively R1’s release has upended the Silicon Valley business model; how decisively China is winning the technological war that the US and the West have been waging; and how the release of R1 demonstrates more clearly than ever that, notwithstanding decades of anti-socialist propaganda to the effect that, for all its faults, capitalism is best at advancing technology and, thus, the forces of production, while socialism has always failed at innovation, capitalism’s capacity to advance the forces of production is manifestly exhausted, while socialism is only now beginning to show its potential in that respect. This article discusses the first point in detail, showing that the vaunted Silicon Valley Model is systematically reliant on hyping what the technologies it offers can deliver in terms of growth or material welfare and on financial hype about the returns it can bring, combining science and financial fiction. It also traces the main academic arguments that have been mustered to support this fictional approach. It touches on the other two points only briefly in the conclusion.