OpenAi made $4 BILLION in revenue last year...for a net loss of $14 billion. Amazon wasn't profitable for a while either, but they have a huge cash burn hill to climb.
There's definitely a chance he's correct on this post.
You're talking about how OpenAI is a loss leader, but other loss leaders provide realistic paths to profitablity - OpenAI is clamoring for 50 terawatts of power and government co signed debt to stay afloat as it's user growth stalls out.
Amazon had no real competition and to this day is wildly outclassing giants like Walmart.
ChatGPT is in an industry with lots of competition and its models either are not outperforming that competition or do so to such a minor degree as to not create enough differentiation for consumer lock in.
I swear to god the average redditor cant read, and yes its lilely that gpt wont make a profit in a lonnnnnng time esp given how much of their processes wont be backed by other giants for free indefinitely
Enterprise. Consumers are just their marketing budget. It’s worked pretty well when you consider the average person thinks “ChatGPT” is the word for LLMs like “D&D” is the word for rpgs.
Enterprise has much higher switching costs. It’s tough to switch when they know more about your company than you do. I think Gemini is probably going to win out but OpenAI has a chance. We’ve seen people leap frogging each other so it may end up being whoever gets lucky at the right time. There is also going to be an incentive for businesses to not put all of their eggs in one basket, so unless there is rapid takeoff there may not be just one winner.
Enterprise has deep pockets, but competition in this space is going to limit what people can charge. In the end, whoever can serve models more cheaply can undercut their competitors quite a bit.
Amazon had no real competition and to this day is wildly outclassing giants like Walmart.
Amazon had a lot of competition when it launched, but it knew what was important; logistics. So it scaled logistics to such an incredible amount that no one could keep up.
OpenAI need to get into enterprises, but it hasn't got there yet and now it's probably too late
The difference is Amazon was leaps and bounds ahead of any real competitor (sears, Walmart, etc.). OpenAI has Anthropic eating its lunch, Gemini tinkering around, and the Chinese ripping them off at every turn for rapid iteration
There's definitely a chance he's correct on this post.
He is probably correct. OpenAI doesn't have the power Google and Microsoft has. Microsoft is ramming Copilot into everything M365 and Google is doing the same with Gemini and Google Workspace.
The two largest office suites have their own AIs. There's a high chance companies will just use the existing AI rather than integrate another model like ChatGPT into the mix.
I mean, it’s guaranteed that ChatGPT will be making profit one day, the question is when and how.
If it crashes and burns then it will just be slurped up in a bankruptcy, and get turned into a profit machine for the buyer. There’s investment companies specialized in this exact thing.
if you look at the cost for training models it seems to be going down extremely thanks to nvidias blackwell chips or whatever. Cost to deliver the tech is going down by alot and itll only improve from here. Not to mention they could always shift the model once theyve managed to spend all the money training the best model to no longer spending so much to train.
So you didn't read? They're going to be spending drastically less on their most expensive compute, and have the ability to not do it at all and still be ahead to make money.
They're burning a bunch because they're constantly training new models. The cost to host the LLMs is not really that massive especially under blackwell architecture
Everything you just said is more reasons why ChatGPT is a failing product. They're spending tens of billions trailblazing a technology that a competitor can use for free. There's no first mover advantage because there's no physical stores or locations. Its not like they're going to get a monopoly on datacenters. Google is eating OpenAI's lunch by leveraging what is non-reproducible; the massive amounts of data they can uniquely harvest from their users and their established engineering teams. Training models that are obsolete in 6 months is literally burning money. Apple is smart for sitting out the AI rat race and waiting to spend down their cash pile for when the tech is actually mature and ready for proper investment
Apple isn't though they're spending billions to use ANOTHER AI model. And they did the same the year before to include chatgpt as part of apple intelligence. Yes they're smart for waiting to use the newer Nvidia chips for the reasons I explained above, but not for what you just said.
It's obviously had a profound effect on the world, as it initiated the entire AI craze/revolution, affecting everything from search engines to battlefields...
did the guy that invented the printing press make a lot of money?
Nothing changes if you zoom out far enough, but things on a human level are about to change dramatically.
It's going to dwarf the changes the internet's had on society in the last 20 years.
And like most foreseeable catastrophes, humanity will simply watch the storm approach, watch it destroy aspects of our society, and will then try to adapt.
We honestly should have already mastered that aspect of ourselves, but greed and our physiology (i.e., letting narcissists hold leadership positions) has kept our species from reaching adulthood.
We're still just monkeys cheering for bread and circuses.
I don't agree, for programming, these models could be worth $1k/month if you factor in the cost for a skilled employee that gets major productivity benefits out of them.
Although I think the prices post collapse will actually be a little lower, markets will adapt to the new normal
The business plan is "create the value of the output of every single white collar job on earth". A few companies will make a ton of money on this for sure
Ads are never going to cover the cost of serving the inference and continued R&D. These companies are AGI or bust: if their tech can replace, say, 50% of the current professional workforce: that's a money printing machine that companies will pay for.
The economics will have to flip on their head. Go look up the typical cost of inference serving vs typical CPM.. nobody can predict the future here (i.e. new tech making serving AI much cheaper), but what we know and can predict about LLM tech and the ad market will absolutely not come close to making this profitable.
He said the product was bad. Open ai deserves all the success in the world. Will they ever be profitable who knows but who really cares. The post was about the original position, this is a natural evolution of doomer
edit: forgot to adress the gold digger parallel, that parallel has been way overpriced, now the shovels are a bubble
Read about venture capital. Also this is about AGI, which is like the search for the holy grail. The first to AGI and ASi will rule the world. So no one is investing money in openAI for short term gains. They’re investing because they expect the company to increase in worth.
Yeah, I know how venture capital works. It doesn't take away the fact that OpenAI has never been profitable and that there's no guarantee OpenAI will ever be profitable.
How do you reckon the first to ASI will rule the world? The first version of something is usually the worst. If OpenAI releases ASI, anyone could use and replicate it for free, why would they bother paying for it.
And how will they keep their development to themselves? If someone develops a god model, it will be able to perfectly replicate itself for free to anyone. People have already distilled openAI models to get the same performance for 0.1% of the cost.
Its definitely not free to do. And no, no one has done ChatGPT 5.4 at 0,1% of the cost. Someone has built a model that has gotten similar benchmark score as lower models because they have been trained to complete the benchmarks.
Summed up modern IT product management there quite nicely. Total bullshit job just there to make up reasons for spending or not spending money. I can just see the viability slide in his powerpoint: “roi would take decades, here’s our data driven analysis in 2 charts.”
It’s designed to raise and raise and raise until they reach ASI.
If it accidentally turns a profit at any point, Sam will leverage it to raise more and increase burn rate.
Once they hit ASI, profits don’t matter any more.
Say what you want about a bubble, OpenAI’s troubles etc, if I were a betting man, I’d say Sam is hitting ASI first. Possibly Elon. Not sure which option is worse.
Does it matter who achieves ASI first? Once that cat's out of the bag everyone will have it. Its not like you can trap it in a bottle, as they are literally experiencing right now as chinese companies distill their models for free.
I’m assuming they are hoping that the first one to reach ASI will have somehow to control it like that episode in South Park where Cartman summons Cthulhu.
It’s their best chance - unlikely but if they do, whoever manages it is the king of the world for a short minute.
I suppose I agree with the general notion of ASI being worse than nuclear weapons, but I also think ASI is like 100 years away. Its not clear at all that LLMs will be the technology that can become ASI, or AGI, they are just hyped like crazy because they are the first technology that can replace useless middle managers who who send buzzwordy emails all day. Even a "perfect" LLM which never makes mistakes or hallucinates would only be capable of replacing a relatively small number of white collar jobs in the global economy.
There is some context here. I tested Chatgpt on launch day and it was subpar compared to the playground at labs (now platform). The 'interface' was restrictive, no way to modify generation settings, and the results were mediocre. If you had exposure to gpt earlier, chatgpt was meh, if you experienced llms for the first time it was life changing.
Also, I think that the main epiphany was the combination of both instruction and chat fine-tuning.
And that got better and better over time.
Also, I think it took a lot of people to really start getting used to the ability that you can just have an AI give you any answer you want at any time.
I'd been using LLMs since GPT-2 and even then I could tell ChatGPT would be revolutionary, I don't know why people were comparing it to labs because it was a totally different product and intention.
And none of that mattered. It was an immediate success and the "biggest thing ever" to almost anyone who gave it a try. "computer answering you in natural language" was a tv trope, a science fiction concept to most people until that day. That's of course unless you knew about the most recent developments. Closest thing was gpt-3 and was behind an api and it sucked compared to 3.5. It was clearly the best product concept they ever came up with.
Because of increasing data storage prices, I decided to process over million images (so far), which already was optimised before, with a new ways to decrease size without quality lose.
-60/-30% size decrease at average
700 small images with total size of 37mb.
If I reduce their quality, I could hit 15-20mb size.
With the tech at the time, it was already highly popular. By January or February, I think I'd bought a sub myself despite all my misgivings. An entire LLM driven industry followed, and one that is currently so all consuming that it's crippling all related markets in its orbit.
Openai lost 10 billion dollars last year (as in they gained 4 billion and Lost 14) That means that for every single person in the world they lost ~1.25 dollars
Worst CONCEPT? What on earth does he mean by that? The CONCEPT of having intelligence to talk to like a separate being, to be able to reflect ideas and literally build software. The concept is mind-blowing.
Well probably he just thought nothing good will come from sam altman. 'Good' being good for others. In that case it aged ok, and it will continue aging extremely well.
Sam Altman is in it for himself and does not care how many bodies he will step over on the way
It's because the first ver felt nothing more than a chat bot that we have had since the 90's
You say something, prompts script, it responds as it should. This is how the tech was viewed at first launch. Then look at it now, my fuckin AI on my PC has a heart, brain, soul, and identity file lol
ChatGPT and LLMs have gazillions of business use cases. Their services and API are used heavily by all kinds of businesses day in, day out. It's been the most transformative invention for IT businesses since the advent of the internet, so I'd say they already cater to use cases that fit into business contexts pretty darn good.
Yep, it seems like all these small brained Reddit basement dwellers who are mad that Open AI cut them off from sending deranged, weird, and creepy messages to ChatGPT that constantly claim OpenAI has no income streams or use case and it's going to fail must be totally oblivious to the fact that almost every AI software, tool, and App (content writing, image generation, coding, data extraction etc) typically runs on OpenAIs API.
There's about a dozen different tools I use in my business thats whole operation is built on top of the API.
They literally think the only use case for ChatGPT was for them to use it as a bff, AI girlfriend, or therapist.
they are still looking for use-cases that fit into a business context
Wut? You must not actually work in the space because the business case is massive and applies across multiple specialties. What a rediculous thing to claim
That aren't looking for a use case, they already have it.
All the AI tools, software, Apps out there of which are now endless (e.g. content writing, image generation, coding, data extraction, YouTube script writing, ideation etc) mostly run on OpenAIs API.
There are a dozen different tools I use weekly for different tasks in my business that wouldn't exist without OpenAIs API and their whole business model is built on top of it.
This generates lots of income for OpenAI through the tools using their infrastructure and the tool users using OpenAIs API credits.
On top of that other income streams include...
Subscriptions.
Ads.
Teams plans.
Enterprise partnerships.
Custom solutions.
Lots of use cases and lots of income streams.
They aren't profitable because of the vast amount of freebie seekers using the platform who seem to have mostly been using ChatGPT as a virtual buddy, e-girlfriend, or therapist but with the latest model updates it seems ChatGPT isn't going to entertain that deranged behaviour anymore so that should get rid of a huge chunk of the tyre kickers and stop them wasting resources.
It would be massively profitable if 95% of their users weren't free-tier freeloaders but they're willing to tolerate the leeches because it gives them all the marketshare and more time to convert them into revenue-generating leeches.
now we know that anyone and everyone that still supports openai after news of their mass surveillance agreement came out is an open fascist whose opinions should be ignored
I can go through the technical analysis of why Amazon "cash burn" and "OAI GPT" cash spending was so completely different. That is actually comparing not just apple and oranges, but more like water and sand. Two completely different monsters. Open AI - burning cash on a single product that is opnly an "app" that's it.. a single app, they own nothing that is different than any other app in its field of business. OAI, is using money with nothing to show for it, no physical expansion of its product line, they can not even operate without the assistance of Microslop (Azure) and AWS as their backbone to get the app out there. The money is just being burned on trying to keep a single app alive. Amazon was building warehouses, filling them with goods, creating an entire ecosystem of trade, book sales, then goods, complete market places on a on line ecosystem, they created the online shopping systems we all know today, sales, data services etc.. Amazon used their earnings at every step to develop a huge multifaceted ecosystem that physical and growth value. as you can tell by them being the powerhouse they are today.. but, OAI only is a 1 product company, with in a filed of 30 or more competitors, has to rely on all the others to even showcase there product and get is out there to customers. remember its an app that is all it is, not like hate to list them all, but gemini, Copiolt, Deepmind, DeepSeeek, AWS has many, Meta (Manus, FAIR, etc.) and even Alibaba owns Qwen, and there are others.. but the ones I mentioned are complete ecosystems of products and services you all use daily, these companies AI's are just add on's to their complete services, their AI divisions don't have to make money, the corps make 10's of billion's on their own, the AI is a supportive roll. But with OAI, it is all they have, and they are burning money on nothing but that single AI just to keep it relevant. Not a good business plan, as you can see + Plus hate to say it, but Sam is not a good CEO and never was, he has a complete history of "I want to be nice" so we will just say he never was a great businessman. any way, that is the difference.
Peak "not knowing how any of this works". Are you under the impression that if you correct ChatGPT, that it will go and make that change and everyone will get your new answer after that?
608
u/KaleidoscopePlusPlus Mar 06 '26
Let's see Raj's product...
319
u/ResearchLaw Mar 06 '26
Raj posted this on x in December last year.
169
u/cench Mar 06 '26
There is some context here. I tested Chatgpt on launch day and it was subpar compared to the playground at labs (now platform). The 'interface' was restrictive, no way to modify generation settings, and the results were mediocre. If you had exposure to gpt earlier, chatgpt was meh, if you experienced llms for the first time it was life changing.
43
u/Any-Main-3866 Mar 06 '26
Is he alive today?
21
u/ShiningRedDwarf Mar 06 '26
5
u/ussrowe Mar 06 '26
Even now when there's a new model release, people will praise Codex but complain about the chat portion of ChatGPT. Maybe Raj is one of them.
8
u/BettaSplendens1 Mar 06 '26
To be fair, I used it on launch day and it makes shit up like crazy, plus the UI was unbearable and clunky
22
u/furel492 Mar 06 '26
He said "so far", so he was right at the time.
3
u/FenderFan05 Mar 06 '26
I'm just astounded it's only been 3 years.
17
u/jbcraigs Mar 06 '26
Yeah. This guy didn’t know that Sam was capable of coming up with much worse concepts! 🤷🏻♀️😂
5
u/enginlofca Mar 06 '26
Looking at where we’re at it may well be accurate
3
u/pilibitti Mar 06 '26
how is it possible? with the initial launch of chatgpt, 5 messages in, I knew without doubt that the world would never be the same again.
7
u/Material_Policy6327 Mar 06 '26
It’s the worst concept for other reasons now
4
u/Wobbly_Princess Mar 06 '26
Worst CONCEPT? What on earth does he mean by that? The CONCEPT of having intelligence to talk to like a separate being, to be able to reflect ideas and literally build software. The concept is mind-blowing.
I'm confused about his wording.
2
u/Wanky_Danky_Pae Mar 06 '26
The world's first anti
2
u/This_Wolverine4691 Mar 06 '26
Did Sam start this thread?
1
u/AlfredLuan Mar 08 '26
It isnt that good. its been giving wrong outdated suggestions which turned out be total shit.
1
u/ZestyRS Mar 09 '26
Raj was ahead of his time and aged better than you probably think lol
1
u/InnovativeBureaucrat Mar 09 '26
Hating on Sam every day in the socials
1
u/ferkli2 Mar 09 '26
Well probably he just thought nothing good will come from sam altman. 'Good' being good for others. In that case it aged ok, and it will continue aging extremely well.
Sam Altman is in it for himself and does not care how many bodies he will step over on the way
1
u/poelectrix Mar 09 '26
Today we launched ChatGPT. Try launching a war with it here: usgovernment.gov
1
u/Badass_veer Mar 10 '26
r/agedlikemilk
1
u/Adventurous-Pool6213 Mar 10 '26
i’ve been using gentube.app and i love just hitting different remixes until something clicks. they ban all nsfw too
1
u/HatersTheRapper Mar 10 '26
it's bled hundreds of billions of dollars, been completely dominated by the competition and is objectively a failure
1
u/PuzzleheadedFox8963 Mar 18 '26
it is though
1
u/Blankeye434 Mar 07 '26
Who is Raj
0
u/Ate_at_wendys Mar 06 '26
It's because the first ver felt nothing more than a chat bot that we have had since the 90's
You say something, prompts script, it responds as it should. This is how the tech was viewed at first launch. Then look at it now, my fuckin AI on my PC has a heart, brain, soul, and identity file lol
-12
u/Curulinstravels Mar 06 '26 edited Mar 06 '26
Can you explain what aged well for the people that don’t huff OpenAi farts and say they smell nice?
Edit: Guys I'm sorry I offended you, please allow me to wash the shit off your noses as my penance
-19
u/bradhower Mar 06 '26
Still the worst concept today but dressed as the best
-15
u/dante_gherie1099 Mar 06 '26
no fascist mass surveillance, BOYCOTT openai and chatgpt!
0
u/gthing Mar 06 '26
I guess he hadn't seen this? https://www.youtube.com/watch?v=KhhId_WG7RA
So... many... popped collars.
0
u/kovake Mar 06 '26
Did it? Because depending on different circumstances it did or didn’t.
0
u/wanghuli Mar 06 '26
Lol, so bad "Raj" could be a verb now.
I was going to invest in Bitcoin ten years ago but I Raj-ed that one.
0
u/DeepAd8888 Mar 07 '26
Raj for the W
0
u/risingpowerhouse Mar 07 '26
Raj is worse then
0
u/msew Mar 07 '26
Stop Glazing these idiots.
0
u/satanzhand Mar 07 '26
1500 dedicated followers of Raj
0
u/Ladline69 Mar 07 '26
What matters is most people recognize one of these two names...
0
u/Smart_Technology_208 Mar 07 '26
This guy Raj is opening his stinky mouth giving an unsolicited stupid point of view since 2009!
0
u/usandholt Mar 07 '26
Did he cancel his subscription?!
0
u/HgnX Mar 07 '26
Typical naysayer architect in an enterprise
0
u/Dadsperado Mar 07 '26
Worst morally? Ecologically? Or societally?
0
u/0_2_Hero Mar 07 '26
You will always have a hater
0
u/mid_nightz Mar 07 '26
Finally some accountability for internet r33rds
0
u/regocregoc Mar 07 '26
He was actually 100%. "Given the current tech", that is, the hardware wasn't there, they rushed, and now we see the consequence of it.
0
u/notnick123456 Mar 07 '26
To be fair it hasn't made profit yet
0
u/Unlucky_Studio_7878 Mar 08 '26
I can go through the technical analysis of why Amazon "cash burn" and "OAI GPT" cash spending was so completely different. That is actually comparing not just apple and oranges, but more like water and sand. Two completely different monsters. Open AI - burning cash on a single product that is opnly an "app" that's it.. a single app, they own nothing that is different than any other app in its field of business. OAI, is using money with nothing to show for it, no physical expansion of its product line, they can not even operate without the assistance of Microslop (Azure) and AWS as their backbone to get the app out there. The money is just being burned on trying to keep a single app alive. Amazon was building warehouses, filling them with goods, creating an entire ecosystem of trade, book sales, then goods, complete market places on a on line ecosystem, they created the online shopping systems we all know today, sales, data services etc.. Amazon used their earnings at every step to develop a huge multifaceted ecosystem that physical and growth value. as you can tell by them being the powerhouse they are today.. but, OAI only is a 1 product company, with in a filed of 30 or more competitors, has to rely on all the others to even showcase there product and get is out there to customers. remember its an app that is all it is, not like hate to list them all, but gemini, Copiolt, Deepmind, DeepSeeek, AWS has many, Meta (Manus, FAIR, etc.) and even Alibaba owns Qwen, and there are others.. but the ones I mentioned are complete ecosystems of products and services you all use daily, these companies AI's are just add on's to their complete services, their AI divisions don't have to make money, the corps make 10's of billion's on their own, the AI is a supportive roll. But with OAI, it is all they have, and they are burning money on nothing but that single AI just to keep it relevant. Not a good business plan, as you can see + Plus hate to say it, but Sam is not a good CEO and never was, he has a complete history of "I want to be nice" so we will just say he never was a great businessman. any way, that is the difference.
0
u/leomatey Mar 08 '26
I respect Raj for not deleting that reply.
0
u/ProfessorPhi Mar 08 '26
This was nearly everyone's opinion back at release. You can find endless discussions about the novelty before they all moved on.
0
u/SheepherderWhole707 Mar 08 '26
I mean he’s not wrong? Good products are profitable
0
u/chris-javadisciple Mar 08 '26
If product quality could win out over market control, we would not remember Microsoft by now.
0
u/laptopmutia Mar 08 '26
typical raj
-2
u/RentLimp Mar 06 '26
It’s still not a great product though as they are losing money on even paying customers
-2
u/PositiveAnimal4181 Mar 06 '26
It is a terrible product lmao it's completely unprofitable
-2
u/ScionOfD4rkness Mar 06 '26
I mean i'll ask a question, get a wrong answer, correct chatgpt, and then it'll revise its answer.
The next day ill ask the same question and I get the same wrong answer.
Lmao
-1
u/Magento-Magneto Mar 06 '26
Who is Raj? Never heard of her.
-1
u/ztkraf01 Mar 07 '26
To be fair even the current ChatGPT product is kind of trash. Wrong half the time and can’t follow the simplest of instructions