Sam Altman’s popular consumer app, ChatGPT, experienced a decline in user count for the first time in June. This indicates a cooling trend in the generative A.I. hype, and comes alongside a class action lawsuit against OpenAI, the company behind ChatGPT, alleging copyright infringement.
ChatGPT can be accessed through its website or mobile app. In June, global traffic to the chatbot’s website declined by 9.7 percent compared to the previous month, with unique visitors dropping by 5.7 percent. These figures signify the app’s first decline in users since its launch in November 2022.
Downloads of ChatGPT’s iPhone app, launched in May, have also sharply decreased since peaking in early June. According to a report by the Bank of America, U.S. downloads of ChatGPT for iPhone were down 38 percent in June compared to the previous month. Similarly, downloads of Microsoft’s Bing app, which includes a ChatGPT-based chatbot, fell by the same margin in June.
Previously, ChatGPT had been the fastest-growing consumer app in history, accumulating 100 million monthly active users within two months. However, this record has now been surpassed by Meta’s newly launched Threads. ChatGPT enjoys widespread usage among students, copywriters, computer coders, and other white-collar professionals.
OpenAI has not provided any response regarding the decline in user count.
Several factors contribute to the waning interest in ChatGPT, including the commencement of summer breaks in the U.S., stricter A.I. regulations in Europe, and the emergence of competing apps. Nonetheless, ChatGPT’s main rival, Google’s Bard, also experienced a decrease in visitor traffic during June, although less severe than ChatGPT. Bard’s website traffic dropped by 1.4 percent compared to May.
While the initial excitement around ChatGPT may have cooled, Alysia Silberg, a seed-stage tech investor and founder of VC firm Street Global, believes that this does not necessarily indicate a decline in interest or development. She asserts that the future for A.I. remains vibrant and promising.
OpenAI CEO Sam Altman now faces additional challenges in the form of legal risks surrounding the company’s core technology. Comedian Sarah Silverman, as well as novelists Richard Kadrey and Christopher Golden, filed a class action suit against OpenAI, claiming that the company used their copyrighted work without permission to train its language models. These writers have also filed a separate suit against Meta, the parent company of Facebook, Instagram, and Threads, alleging that Meta has been using their copyrighted content to develop an A.I. chatbot.
OpenAI’s most recent valuation stood at $29 billion. The decline in user count and legal challenges could have a short-term impact on OpenAI’s market worth, according to Alysia Silberg. She states that these factors introduce elements of risk and uncertainty. However, she also emphasizes that investors understand the rapidly evolving nature of A.I. and are prepared for some level of volatility. The key for investors lies in how companies like OpenAI navigate these challenges and demonstrate resilience and adaptability in the face of legal and market changes.
