Chat GPT’s Woes

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Chat GPT’s Woes

As per AIM’s assessment, the widely-used chatbot, ChatGPT, incurs an approximate daily cost of $700,000 for OpenAI. There are concerns that if these financial challenges persist, OpenAI might face the possibility of bankruptcy by 2024.

Key Observations:

OpenAI’s financial predicaments are accumulating at a pace that outpaces ChatGPT’s ability to generate written content, amounting to a total deficit of $540 million since its inception.

Following an initial surge, ChatGPT’s user community dwindled by 12% from June to July, reflecting a decline in enthusiasm.

OpenAI has set ambitious targets, aiming for $200 million in revenue this year and an impressive $1 billion by 2024. However, industry experts remain doubtful about the feasibility of achieving these goals.

Complicating matters, shortages of GPU resources and the departure of employees to rival companies are exacerbating the challenges faced by OpenAI.

Our Analysis: OpenAI sparked an AI revolution with the introduction of ChatGPT, albeit at a significant cost. The prospect of bankruptcy seems unlikely. Nevertheless, the emergence of nimble competitors with open-source models is a credible threat that underscores the urgency for OpenAI to establish profitability swiftly.

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