OpenAI has become the talk of the town since its launch of ChatGPT in November 2022. This platform has been helpful for people as well as posed a threat to replace human jobs.
However, according to a new report by Analytics India Magazine, OpenAI might go bankrupt by the end of 2024.
The report says: “if OpenAI does not get more funding soon, the company might have to file for bankruptcy by the end of 2024 to acquire more NVIDIA GPUs that are coming in the second quarter of the year, and start training their models.”
The report cites a number of factors that are contributing to ChatGPT’s financial problems. The major reason is the decline of ChatGPT users. The report mentions that July 2023 saw a decline of 12% in users.
Source: Analytics India Magazine
Another major factor that might lead the company to go bankrupt is the losses it is facing. According to the report, the company suffered $540 million in losses. The report mentions: “In May, its losses doubled to $540 million ever since it started developing ChatGPT.”
ChatGPT is not yet generating enough revenue to cover its costs. The company has a number of monetisation strategies in place, but they have not yet been successful in generating significant income.
The report also mentions that the constant development of open source Large Language Models (LLMs) has allowed people to develop their own products rather than paying for and using a product with restrictions such as ChatGPT.
The company is currently staying afloat with Microsoft’s investment and its strategies to monetise products such as GPT-4 and DALL-E2 but it is not sure how long these strategies will work.
To conclude, it is important to note that the report by Analytics India Magazine is just one analysis of the situation. It is possible that OpenAI will be able to turn things around and make ChatGPT profitable.
Categories: Trends
Source: HIS Education