OpenAI CEO admits they are currently 'losing money' on $200 ChatGPT subscriptions
CEO of OpenAI Sam Altman has revealed ChatGPT is not making anything from its new pro subscription, in fact, it's losing money.
Even though ChatGPT is sitting pretty as the king of the artificial intelligence castle, that doesn't mean it's making hand-over-fist. There were already a few raised eyebrows at the cost of the $200-a-month ChatGPT Pro, but by the sounds of it, the service could be facing an overhaul.
The whole idea of ChatGPT Pro is that you get unlimited access to the very best version of the AI chatbot, but according to OpenAI CEO Sam Altman, the company might not have thought this through.
Launching on November 30, 2022, ChatGPT is free for many, simply requiring users to sign up with an email address and phone number.
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Hoping to turn a profit, OpenAI has since rolled out different tiers, with the priciest ChatGPT Pro coming in at $200 a month.
Alongside the free version that restricts how much you can use it and the unlimited Pro, OpenAI offers the ChatGPT Plus experience which costs $20 a month and opens the doors to the advanced GPT-4 language model.
OpenAI first tried out paid versions of ChatGPT in February 2023, but nearly two years later, it seems the business model might be struggling. ChatGPT Pro only launched in December 2024, and for those asking what you get for your $200 a month, it boasts of being the most advanced chatbot around.
As well as an advanced voice mode, ChatGPT Pro is run using the o1 model, which spends time 'thinking' before it answers. There's no denying the capabilities of ChatGPT Pro, but the unlimited aspect of it could be hitting OpenAI in the pocket.
Posting on January 6, Altman wrote: "Insane thing: we are currently losing money on OpenAI pro subscriptions! People use it much more than we expected."
Responding to a comment on his post, Altman reiterated that he specifically chose the $200 price tag, thinking it would make money for OpenAI.
In September 2024, the New York Times reported that OpenAI would record revenue of $3.7 billion and losses of around $5 billion for 2024.
The deciding factor is the huge cost it takes to run a powerful AI chatbot in terms of data centers and raw electricity. With so many making use of ChatGPT Pro's 'unlimited' policy, OpenAI is yet to see the fruit of its labors.
There wasn't much sympathy for Altman's plight, with someone responding: "Oh how the non-profit cookie crumbles đȘ."
Another joked: "I'm doing my part to help: I stopped using OpenAI and cancelled my subscription. Hope this helps you lose a bit less đ."
Looking to find a solution, a third concluded: "It would be interesting to know the percentage of users that use up the most resources. Would it be possible to cap the top 1% of users in a way that turns this around or would a reasonable cap affect too many people?"
Despite raising over $20 billion since it was founded, OpenAI continues to struggle to make any profit. Then again, with it costing an eye-watering $700,000 a day to run during peak periods, you can see why.
There's a fierce fight between ChatGPT and Google's Gemini right now, and much like the war between Blu-ray and HD DVD (remember that?), it's likely that only one will come out on top.