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Their spending is not a problem. It's quite low for a top-tier hard tech company that's also running a consumer service with 500M active users. They are making
by jsnell 1y ago
Their spending is not a problem. It's quite low for a top-tier hard tech company that's also running a consumer service with 500M active users. They are making a loss because 95% of their users are on free accounts, and for now they're choosing not to monetize those users in any way (e.g. ads).
- raydev 1y agosama tweeted that the $200 tier was priced too low to cover costs a few months ago.
- aswegs8 1y agoHow credible are his PR statements, though?
- raydev 1y agoYou think "we're losing money on this subscription tier" is good PR for their investors?
- wredcoll 1y ago"This car is priced so low we're practically giving it away!"
- rolandog 1y agoBut are you owning something with a subscription in a market that has normalized hiking their prices? There used to be contracts with service providers, and that — IIRC — usually shielded consumers from exorbitant increases.
- FergusArgyll 1y agoAt that price level you run into serious adverse selection
- sireat 1y agoMeaning someone paying $200 monthly is going to use it as much as possible to get their money's worth. I slightly disagree. My hypothesis would be that the distribution for $200 users would be bimodal. That is there would be a one concentration of super heavy power users. The second concentration would be of people who want the "best AI" but are not power users and feel that most expensive -> the best. Their actual usage would be just like normal free tier of ChatGPT.