OpenAI’s ambitious ChatGPT project has caused the company to suffer ballooning losses in 2022, according to a recent report from The Information. It was revealed by three people familiar with OpenAI’s finances that the investment into creating the cutting-edge AI chatbot cost the company a whopping $540 million that year. This astounding loss was attributed to the high costs of training the machine learning models powering ChatGPT and the hiring of key personnel previously employed by Google. In the months leading up to its launch, OpenAI’s expenses skyrocketed.
OpenAI’s revenues are on a rise, but so are their costs. As more customers start using its AI technology, their spending on infrastructure and maintenance also increase. The AI chatbot has become one of the biggest consumer applications in history and gathered a total of 100 million monthly active users in less than two months.
In light of all this, OpenAI’s CEO Sam Altman has suggested that they’ll aim to raise up to $100 billion over the next few years in order to balance out these losses. This cash would be put towards developing even more advanced AI models which can grow and improve on its own. Altman admitted this would be the most expensive venture in Silicon Valley history.
Staying afloat isn’t cheap either. Just sustaining ChatGPT will initially cost OpenAI at least $700,000 per day, adding up to untold million eventually due to its cloud-based infrastructure. However, these expenses looking up the AI technology dwarf in comparison to the cost of deploying its servers.
In order to generate more income OpenAI launched a paid version of ChatGPT earlier this year. OpenAI was also able to realize gains from their partnership with Microsoft. This agreement catalyzed the creation of an AMD-backed AI chip called Athena which accelerates the process of developing projects like ChatGPT and GPT-4, thus reducing costs significantly.
Thanks to all of this, analysts predict that OpenAI’s revenues would reach around $200 million this year and $1 billion by 2024.
OpenAI is a research laboratory with an aim to develop unsupervised artificial intelligence. Founded in San Francisco, California, the company is backed by billionaires including Peter Thiel, Elon Musk, and Reid Hoffman, who all have a keen eye for AI and its vast potential. Open AI has trained vast language models and has authored a variety of groundbreaking research papers.
Declan is the web editor at People News and is one of the celebrity-world’s biggest fans. He has a knack for following trend and scooping the latest buzz in the celebrity world, and he loves to share his scoops with the public.
