Important Notice for Enterprises: innFactory AI Consulting from Rosenheim, Germany recommends DeepSeek exclusively in self-hosted operation. When using the API, data is processed in China - for the DACH region only GDPR-compliant with your own infrastructure.
Key Strengths
Open Source & Licensing
DeepSeek offers full transparency:
- Public Weights: Fully available on GitHub/Hugging Face
- Licensing: R1 under MIT, V3 under a separate Model Agreement
- Community: Active development
- Customizable: Fine-tuning and modifications possible
MoE Architecture
DeepSeek uses innovative Mixture-of-Experts:
- 671B parameters total, but only 37B active per request
- Efficient: High performance with reduced resource requirements
- Multihead Latent Attention: New attention mechanism
Reasoning Capabilities (R1)
DeepSeek-R1 shows transparent thinking processes:
- Chain-of-thought is made visible
- Particularly strong in mathematics and logic
- Comparable to OpenAI o1
Important Notes
Data Privacy Considerations
Important for Enterprises: DeepSeek is a Chinese company. When using the API, data is processed on servers in China. For sensitive enterprise data, we strongly recommend self-hosting.
- Chinese Company: Server location China (when using API)
- GDPR: Careful evaluation required when using API
- Recommendation: Self-hosting in your own EU infrastructure
Self-Hosting as a Solution
The open-source model can be operated in your own infrastructure:
- All data remains under your control
- No dependency on external APIs
- Full GDPR compliance possible
- Hardware requirements: Multiple high-end GPUs (A100/H100)
Price-Performance
DeepSeek offers excellent value:
- API: Very affordable prices (approx. 90% cheaper than GPT-4)
- Self-Hosting: Free to use (only hardware costs)
- No License Fees: R1 under MIT, V3 under Model Agreement
Our Recommendation
DeepSeek is technically impressive and reaches frontier-level performance in reasoning and coding. For enterprise data, however, we strongly recommend self-hosting or alternatives with EU hosting.
Self-hosted DeepSeek-V3.2 or R1 offers excellent performance with full data control - ideal for companies that don’t want to send data to external APIs.