The promotional discount runs until 5 May 2026. Even at full price, V4-Pro already undercuts GPT-5.5, Claude Opus 4.7, and Gemini 3.1 Pro on per-token costs.

The move is a direct challenge to the pricing strategy of US AI providers at a moment when the Trump administration has accused Chinese firms of distilling American AI models on an industrial scale.

DeepSeek announced on Monday that it is offering a 75% discount on its newly released DeepSeek-V4-Pro model to developers until 5 May 2026, and is simultaneously cutting the price of input cache hits across its entire API suite to one-tenth of previous levels, effective immediately.

The discount was announced in a post on X. The move intensifies a pricing competition with US AI providers that DeepSeek first triggered in January 2025 with its R1 model, which claimed frontier-level reasoning performance at a fraction of the cost of comparable OpenAI products.

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The pricing context is important. At full price, before any promotional discount, DeepSeek-V4-Pro already costs $0.145 per million input tokens and $3.48 per million output tokens, undercutting OpenAI’s GPT-5.5, Google’s Gemini 3.1 Pro, and Anthropic’s Claude Opus 4.7 on per-token basis.

The 75% promotional discount on input tokens reduces the V4-Pro input price to approximately $0.036 per million tokens. The Flash variant, V4’s smaller, faster model, costs $0.14 per million input tokens and $0.28 per million output tokens at full price, already undercutting GPT-5.4 Nano, Gemini 3.1 Flash, GPT-5.4 Mini, and Claude Haiku 4.5.

The cache-hit price cut to one-tenth of prior levels specifically targets frequent users and enterprise developers who send similar or repeated requests, which is the dominant pattern in production agentic applications.

The strategic logic is explicit and well-documented in how DeepSeek has operated since R1. Open-source availability removes the model access barrier entirely; aggressive API pricing removes the cost barrier for production deployment; a 1 million-token context window makes the model viable for enterprise use cases involving large codebases or long documents that would otherwise require multiple API calls.

V4-Pro also integrates natively with Claude Code, OpenClaw, and OpenCode, the dominant agentic coding frameworks used by developers already in the Western AI ecosystem.

The combined effect is to lower the friction of switching from an OpenAI, Anthropic, or Google API to a DeepSeek API for any developer whose primary constraint is cost. Akshar Keremane, co-founder of Bangalore-based AI startup O-Health, described the combination of pricing, open-source availability, and the 1 million-token context window as lowering barriers “for developers, startups and small enterprises.”

The V4-Pro model, launched last Friday, is a mixture-of-experts model with 1.6 trillion total parameters and 49 billion active parameters per task, the largest open-weight model currently available, outstripping Moonshot AI’s Kimi K2.6 and MiniMax’s M1.

Its Hybrid Attention Architecture is designed to maintain coherence across long contexts. It is trained on and optimised for Huawei’s Ascend 950 chips and Cambricon hardware rather than Nvidia GPUs.

Zhang Yi, founder of tech research firm iiMedia, told AFP that V4’s architecture represents a “genuine inflection point” for long-context AI processing, predicting that ultra-long context support will move beyond research labs into mainstream commercial applications.

Wei Sun, principal analyst at Counterpoint Research, noted that V4 running on domestic chips “allows AI systems to be built and deployed without relying solely on Nvidia” and could “accelerating adoption domestically and contributing to faster global AI development overall.”

The pricing move arrives in a charged geopolitical context. On Thursday last week, White House Director of Science and Technology Policy Michael Kratsios accused foreign entities, primarily based in China, of conducting “industrial-scale” campaigns to distil frontier AI models from US companies, a process in which a smaller model is trained using the outputs of a larger model to acquire similar capabilities at lower cost.

Kratsios’s memo did not directly name DeepSeek, but DeepSeek has previously been accused by both Anthropic and OpenAI of distilling their models. CNN reported it has reached out to DeepSeek for comment on those accusations.

The US government’s distillation crackdown, alongside China’s parallel move to restrict US investment in its AI firms, was announced the day before V4’s launch.

DeepSeek’s response, three days later, is to cut prices rather than respond to the accusations directly: a competitive move that is also a political statement about where it believes the AI race will ultimately be decided.

OpenAI has cut API prices multiple times; Anthropic has introduced tiered pricing for different Claude model sizes; Google has progressively reduced Gemini API costs.

DeepSeek’s Monday announcement is the latest move in that ongoing compression, but it is distinctive in its scale, a 75% promotional discount on top of a model that already undercuts the US frontier at standard pricing, and in its timing, which positions the Hangzhou startup as the low-cost challenger in the same week that OpenAI shipped GPT-5.5 and the US government moved to restrict Chinese model distillation.