Luchen Technology becomes first to drop DeepSeek API over cost concerns

AI infrastructure company Luchen Technology has become the first firm to officially discontinue use of DeepSeek’s API, citing cost concerns. The decision comes just days after DeepSeek reported a theoretical profit margin of 545% for its online system. Luchen Technology announced March 1 that it would halt DeepSeek API services within a week and advised users to use their remaining balance. While the company has not publicly elaborated on its decision, insiders told Sina Tech that the move was driven by high operational costs. Sina Tech’s Weibo post noted that while DeepSeek has open-sourced many inference components, third-party MaaS providers struggle to match its official costs. Luchen’s founder, You Yang, has openly questioned DeepSeek’s cost structure, emphasizing the financial strain on smaller cloud providers. [36Kr, in Chinese]