Microsoft Corporation is investigating the potential unauthorised access to data from OpenAI’s technology by a group linked to Chinese artificial intelligence startup DeepSeek, Bloomberg reported, citing sources familiar with the matter.

DeepSeek opened big in the market after the launch of its low-data digital assistant and became the top-rated free application available on Apple’s App Store in the United States on Monday.

According to the report, a group connected to DeepSeek exfiltrated a large amount of data using OpenAI’s application programming interface (API).

Microsoft flagged concerns to OpenAI, detected unusual activity

Microsoft’s security researchers earlier detected unusual activity that they believe was linked to DeepSeek, where some individuals attempted to access and extract data from OpenAI’s API.

Also Read | Who is Luo Fuli, the ‘AI prodigy’ behind DeepSeek’s language models

Software developers can pay for a license to use the API to integrate OpenAI’s proprietary artificial intelligence models into their own applications, Bloomberg reported.

Sources on the condition of anonymity told Bloomberg that this activity could potentially violate OpenAI’s terms of service or indicate attempts to bypass restrictions on the amount of data that could be accessed.

It was also reported that Microsoft, which is both a major investor in OpenAI and a key technology partner, alerted OpenAI about this potential breach.

Also Read | Sam Altman’s old remark on AI scene in India goes viral amid rise of China’s DeepSeek

However, OpenAI did not respond to requests for comment by Bloomberg but a spokesperson for the company did issue a statement acknowledging that Chinese companies, among others, have consistently tried to “distil” the outputs of leading US AI models.

Microsoft also declined to comment on the ongoing investigation.

The discovery has raised concerns about data security and intellectual property (IP) protection, with possible implications for both companies’ business operations and the broader AI industry.

The situation comes on the heels of DeepSeek’s release of a new open-source AI model called R1 earlier this month. DeepSeek-R1 soon became the centre of attraction in the global market.

Its launch caused a significant decline in technology shares worldwide earlier this week and reportedly shook investors’ confidence in the AI sector’s strong demand for high-tech chips.

Also Read | Indian AI expert explains why China was able to create DeepSeek and not India: ‘First, some shocks…’

An improved reasoning model called DeepSeek-R1 asserts that it outperforms current standards on several crucial tasks.

Like all other Chinese-made AI models, DeepSeek self-censors on topics deemed politically sensitive in China.

Unlike ChatGPT, DeepSeek deflects questions about Tiananmen Square, President Xi Jinping or the possibility of China invading Taiwan.