OpenAI, the research laboratory responsible for the development of AI language model, ChatGPT, experienced a huge loss of $540 million in 2022 while constructing the model, as revealed by a recent report by The Information. Though the expense of building AI models and technologies is known to be expensive, this figure is staggeringly large and emphasizes the extent of resources and effort it demands.
In spite of the huge losses, OpenAI intends to generate hundreds of millions of dollars in annual revenue. The company’s CEO, Sam Altman, is reportedly in the process of identifying an additional $100 billion to achieve the growth of self-evolving AI. OpenAI has further expressed the necessity of acquiring data sets for its applications, which are not available freely. Consequently, some companies, such as Samsung, have become wary of the idea of their private data being integrated in the model’s system, which consequently resulted in the ban on usage of generative AI models in company materials.
It has also been reported that a significant part of OpenAI’s costs are related to the hiring of professionals from well-known businesses, such as Apple and Google. The organization was initially prepared to utilize Google Cloud services for its activities worth up to $75 million in 2020. However, the company changed its plans and opted for Microsoft’s Azure platform.
Steve Dowling, OpenAI’s leader of communication and policy, is speculated to vacate the organization soon. There is much speculation regarding the personnel who will take Steve Dowling’s position, understanding that OpenAI’s expenses are partly associated with employing corporate personnel.
OpenAI’s massive financial loss presents a glimpse into the magnitude of resources required to build sophisticated AI models. The concern turns to whether other AI businesses can keep up with the industry pioneer and its expensive developments.
