OpenAI’s ChatGPT became the fastest-growing app in history after its launch in November 2022. Since its launch, it created both excitement and alarm to replace human in jobs. Now a report by Analytics India Magazine has stated that the company might go bankrupt by the end of 2024.
It almost costs OpenAI about $700,000 every day to run just one of its AI services – ChatGPT. As a result, Sam Altman’s OpenAI is burning through cash at the moment. Furthermore, despite their attempt to monetise GPT-3.5 and GPT-4, OpenAI is not generating enough revenue to break even at this point. This is leading to an alarming situation.
Although OpenAI and ChatGPT initially experienced a robust launch with a record-breaking influx of users during their early stages, they have observed a gradual decline in user engagement over recent months. According to SimilarWeb data, July 2023 witnessed a 12 per cent reduction in the user base compared to June, plummeting from 1.7 billion users to 1.5 billion users. Notably, this data exclusively pertains to users visiting the ChatGPT website and does not factor in users employing OpenAI’s APIs.
Earlier in May, the company’s losses doubled to $540 million since it started developing the AI chatbot. Moreover, for 2023, the company has projected an annual revenue of $200 million and expects to reach $1 billion in 2024.
While giants like Google and Meta are often considered OpenAI’s primary competitors, Elon Musk and his xAI project also warrant attention. Musk, who has long been engaged with AI, particularly due to his involvement with Tesla, has made significant strides in the AI realm since the viral success of ChatGPT.
Elon Musk publicly declared his intention to develop a rival chatbot named “TruthGPT,” which aims to mitigate biases and hallucinatory tendencies attributed to OpenAI’s ChatGPT. Furthermore, it was reported that Musk invested over $10 million in over 10,000 NVIDIA GPUs for his AI initiative, in addition to substantial expenditures on human resources and data centre operations to facilitate the training of xAI’s algorithms.
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