The High Cost of Talking: Is Chat GPT’s Existence On The Line?

Last year, Chat GPT became a global sensation. It could write essays, clear exams, compose emails, and even crack jokes. The AI language model, developed by OpenAI, was the talk of the town. But now, seven months after its launch, it’s making headlines for a different reason.

Is Chat GPT Going Broke?

A new report paints a dire picture, suggesting that OpenAI, the company behind Chat GPT, is on the brink of bankruptcy.

Why? Because the costs are sky-high. It takes approximately $700,000 a day to keep Chat GPT running. That’s over five crore rupees every single day. OpenAI is burning through cash at a staggering rate—and its user base is shrinking.

So, will Chat GPT crash and burn? This detailed report throws up more questions than answers.

The Chat GPT Paradox: A Golden Goose or a Money Pit?

Let’s ask ourselves: When Chat GPT helps you write an essay, do you ever wonder who is footing the bill? The rise of generative AI has taken the world by storm, but rarely do we talk about its cost. The aforementioned report has cast light on a stark reality: OpenAI, the maker of Chat GPT, may be on thin ice.

This isn’t just another expensive service. It’s a mammoth expense. Every day, $700,000 is spent to keep Chat GPT online. This cost doesn’t even encompass OpenAI’s other initiatives, like GPT-3.5 and GPT-4.

But who can afford such a cost? Is the deep investment sustainable?

A Financial Precipice

In the last year alone, OpenAI reportedly lost around $540 million as it developed Chat GPT. Now, it projects a need for $100 billion to fulfill its ambitions. A lofty figure, indeed.

OpenAI projects an annual revenue of $200 million in 2023. In 2024, it expects to reach $1 billion. However, the inconvenient truth remains: OpenAI isn’t profitable yet. The only lifeline? Perhaps Microsoft’s $10 billion investment.

The User Exodus

This comes at a time when Chat GPT’s user numbers are declining. Last November, Chat GPT was the fastest-growing app in history, with a record-breaking influx of users. But since then, the company has witnessed a significant decline.

From June to July alone, there was a 12% drop in users. The numbers fell sharply from 1.7 billion to 1.5 billion.

The Underestimated Expense of Innovation

Creating something like Chat GPT demands immense processing power. Training these AI models costs tens of millions of dollars.

It’s a significant investment, both in state-of-the-art chips and in recruiting top-tier researchers. Add to this the unpredictable costs of cloud computing—companies often let their engineers run bills as they rush to innovate, and then they are often in for a big surprise: mounting bills.

Is this the dark cloud looming over the AI revolution?

The Future Cost of AI: A Warning

While companies like OpenAI may be operating at a loss, bypassing profit in the initial stages, this strategy suggests an inevitable outcome. The staggering cost of developing and maintaining AI like Chat GPT will eventually—almost certainly—be passed on to the customer.

So, next time you ask Chat GPT to help with your next project, pause for a moment. Could that assistance be a million-dollar question in the making?

Are we, the users, ready for the moment when the real cost of such a service is revealed? Is the world prepared for the potential financial fallout of this AI revolution?

In an industry that’s racing towards the future, are we ignoring the steep price of progress?

Only time will tell.