Microsoft Integrates DeepSeek’s R1 AI Model into Azure

Microsoft has made DeepSeek’s R1 artificial intelligence model, developed by the Chinese startup, available on its Azure cloud computing platform and GitHub tool for developers, the US company announced on Wednesday.

The AI model will be listed in the model catalogue on both platforms, joining more than 1,800 models already offered by Microsoft.

Last week, DeepSeek launched a free AI assistant, which it claims operates using less data and at a fraction of the cost of existing services. By Monday, the assistant had surpassed US rival ChatGPT in downloads from Apple’s App Store, triggering concern among tech stock investors.

This move comes as Microsoft seeks to reduce its reliance on OpenAI, the creator of ChatGPT. According to a Reuters report last month, the company has been working to incorporate both in-house and third-party AI models to enhance its flagship AI product, Microsoft 365 Copilot.

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Microsoft also stated that customers will soon be able to run the R1 model locally on their Copilot+ PCs, a development that could address privacy and data-sharing concerns associated with the model’s usage.

DeepSeek has acknowledged that it stores user data on servers in China, a factor that may hinder its adoption in the US.

Meanwhile, Microsoft and OpenAI are investigating whether data generated by OpenAI’s technology was accessed without authorisation by a group linked to DeepSeek, Bloomberg News reported on Tuesday.

DeepSeek’s rapid emergence in the AI sector has prompted a response from competitors. OpenAI CEO Sam Altman stated that the company would “bring forward some releases,” following which it launched a specialised version of ChatGPT for US government agencies on Tuesday.

China’s Alibaba also unveiled an updated version of its Qwen 2.5 AI model on Wednesday.