Microsoft survey says China’s DeepSeek dominates developing world while West watches

DeepSeek, a Chinese AI startup that competes with OpenAI’s ChatGPT, is picking up steam across developing nations. The trend could help narrow the technology gap between rich and poor countries, new research suggests.

Microsoft put out a report Thursday showing 16.3% of people worldwide were using generative AI tools from October through December. That’s up from 15.1% the previous quarter.

But there’s a problem. Wealthier countries are adopting AI nearly twice as fast as developing ones, making the divide bigger instead of smaller.

Juan Lavista Ferres, chief data scientist at Microsoft’s AI for Good Lab, said his team is worried. “We are seeing a divide and we are concerned that that divide will continue to widen,” he said. The lab used anonymous device data to track how people use AI globally.

Countries that invested early in digital systems lead the pack. The United Arab Emirates, Singapore, France, and Spain had the highest rates of AI users. A separate Pew Research Center survey from October found similar patterns. Both studies showed South Korea really embracing the technology.

Microsoft has skin in the game here; the company’s future depends partly on AI tools becoming popular and making money. But Lavista Ferres said his lab is looking at the bigger picture.

DeepSeek’s open-source model disrupts traditional AI markets

DeepSeek started in 2023 and is helping drive AI adoption in poorer countries because it’s free and “open source.” Anyone can access and modify key parts of the technology.

The company released its R1 model in January 2025, claiming it cost less to run than OpenAI’s version. That got attention in tech circles worldwide. Many were surprised at how fast China is catching up to the U.S. in this space. Nature, a leading science journal, even published peer-reviewed research last September co-authored by DeepSeek founder Liang Wenfeng. They called it a “landmark paper.”

DeepSeek works well for math and coding tasks, according to Lavista Ferres. But it handles politics differently than American AI models.

“We have observed that for certain type of questions, of course, they follow the same type of access to the internet that China has,” he said. “Which means that there will be questions that will be answered very differently, particularly political questions. In many ways that can have an influence on the world.”

Anyone can use DeepSeek’s chatbot for free on the web and mobile. Developers can also build on top of its core system at no cost. Microsoft’s report said this “lowered the barrier for millions of users, especially in price-sensitive regions.”

DeepSeek didn’t respond to questions about the report.

Western nations raise security concerns over Chinese AI platform

Some developed countries aren’t happy about it. Australia, Germany, and the U.S. have tried limiting DeepSeek use over security worries. Microsoft even banned its own employees from using it last year. The report found DeepSeek usage stayed low in North America and Europe.

It’s a different story in China, Russia, Iran, Cuba, and Belarus – places where U.S. tech services face restrictions or limited access. DeepSeek usage jumped in those countries.

The platform often comes pre-loaded on phones made by Chinese companies like Huawei, which helps explain its spread.

Numbers from the report show DeepSeek has 89% of China’s market. Belarus came in at 56% and Cuba at 49%, though both countries had low AI use overall. Russia was around 43%.

Syria and Iran saw DeepSeek capture about 23% and 25% of their markets. In African countries like Ethiopia, Zimbabwe, Uganda, and Niger, the company held between 11% to 14% market share.

AI has become a geopolitical tool as Chinese influence is expanding. “Open-source AI can function as a geopolitical instrument, extending Chinese influence in areas where Western platforms cannot easily operate,” the report said.

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