According to a research, OpenAI’s ChatGPT, the fastest-growing app, may go bankrupt by the end of 2024. The reasons given are a decline in users and growing losses.
After its November 2022 launch, OpenAI’s ChatGPT became the fastest-growing app in history. Since its inception, technology has generated both enthusiasm and concern about replacing humans in occupations. According to a new study from Analytics India Magazine, the company may go insolvent by the end of 2024.
According to the study, when OpenAI registered for a trademark on GPT, it was viewed as a setback for the corporation, and many users were projected to abandon the technology.
The survey also showed that the ChatGPT website saw a decrease in users in June and July when compared to May. According to SimilarWeb, ChatGPT traffic has dropped for the second month in a row. The month of July had a 9.6 percent drop, while June saw a 9.7 percent drop. In terms of consumers, July showed a 12% decrease with 1.5 billion users compared to 1.7 billion in June.
According to the study, a user on X stated that a key cause for this reduction could be API cannibalisation, since most organizations have prohibited their employees from using it for work. However, you are free to incorporate the large language model (LLM) into other workflows by using the API.
According to Analytics India Magazine, another factor could be Mark Zuckerberg’s Meta, which recently introduced its Llama 2 chatbot. Microsoft has been named Meta’s chosen partner for Llama 2, which will be available via the Windows operating system. Meta’s Llama 2 has been released open source, which means that the original code is freely available for research and modification.
According to media sources, OpenAI spends approximately $700,000 per day to run ChatGPT. According to Analytics India Magazine, Microsoft and other recent investors are covering these costs out of their own pockets, which could drain them if revenues do not materialize quickly.
Earlier this month, the company’s losses more than doubled to $540 million since it began creating the Ai chatbot. Furthermore, the company plans to generate $200 million in revenue in 2023 and $1 billion in 2024. According to the study, this appears to be a blur as the losses continue to pile.
Another issue could be a continual lack of graphics processing units (GPUs). Altman stated that the company’s ability to enhance and produce new models was hampered by a scarcity of GPUs on the market. Earlier on 3 August, media reports said that the corporation had filed for trademark application for ‘GPT-5,’ indicating that the company intends to continue training models.
Given these factors, OpenAI may be forced to declare bankruptcy by the end of 2024 unless it quickly raises additional funding, according to the research.
Earlier on July 19, Bloomberg reported that Apple is developing its own artificial intelligence-powered chatbot to compete with OpenAI and others, but the corporation has yet to have a clear strategy for delivering the technology to users. Elon Musk has also claimed that his new AI startup, xAI, understands the cosmos better than Google and OpenAI. He had previously criticized OpenAI for being dominated by Microsoft. Musk is teaching xAI to be’maximally curious’ and to adhere to human values. Musk has criticized OpenAI, which he helped co-found in 2015. According to the millionaire, OpenAI is “training AI to be woke” and is “effectively controlled by Microsoft.”
Meanwhile, in June, OpenAI CEO Sam Altman stated that the Microsoft-backed startup has no intentions to go public anytime soon. “When we develop superintelligence, we are likely to make some decisions that most investors would look at very strangely,” Altman told Reuters. “I don’t want to be sued by… public market, Wall Street, etc, so no, not that interested,” he answered when asked if he plans to take OpenAI public. As it spends more in processing capacity, the company has raised $10 billion from Microsoft at a valuation of about $30 billion.The corporation began as a non-profit organization, but eventually evolved into a hybrid “capped-profit” entity that allowed it to raise external funding while ensuring that the original non-profit operation continued to benefit.