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You may not be following OA for a while! They’ve never turned a profit. So, someone on the other side has to lose for them to stay afloat!

mrweasel 1y ago
> They’ve never turned a profit Now that OpenAI is starting to talk about ads and allowing "erotic" content, I feel more comfortable in my prediction that not only have OpenAI never turned a profit, they never will. They will be consumed by Microsoft or crash the market so hard it's not even funny. The technology will survive, and it will be useful, but OpenAI as a company is done.
- ed_elliott_asc 1y ago
  Do you predict the same for Anthropic? Hopefully they will stick around.
  - mrweasel 1y ago
    The problem, I think, is that IF OpenAI fail, they'll take with them a lot of other AI companies, simply because funding will be redirected away from the field entirely. If you're profitable, then you're probably going to be fine. If anything your operating costs will go down as there is less competition for staff and compute.
  - Yizahi 1y ago
    If we go purely by economics, then Anthropic belongs to the same category of LLM corporations - ones which have only LLM as a product. As opposed to the likes of Google, Microsoft, even Facebook. Sure, these LLM-first corporations have a very tiny lead in both technology and (LLM) brand recognition, but it is shrinking fast. I suspect that only companies which will bundle LLMs with other big products (and do it cheaply) will survive in the long run.
- alangibson 1y ago
  This. If you really think you're a couple of years away from building Digital God, and today have virtually unlimited access to capital, you are not going to spend time shipping a sexy mode.
  - thfuran 1y ago
    Why not do both if you have unlimited capital today?
    - Yossarrian22 1y ago
      Do they also have infinite labor?
      - nativeit 1y ago
        Isn’t the whole point of AI to replace labor? If they really want to put their money where their mouth is, they’d be casting off staff at a prodigious rate.
    - alangibson 1y ago
      Because you don't have unlimited attention
      - thfuran 1y ago
        But people have attention now, and it's surely quicker to make sexy mode than God.
- ml-anon 1y ago
  It’s amusing how “ads” is seen as an obvious way to make profit for OAI as if Google’s (especially) and Meta’s ads businesses aren’t some of the most sophisticated machines on the planet. Three generations of Twitter leadership couldn’t make ads on that platform profitable and that exposes far more useful user specific information than ChatGPT. The hubris is incredible.
  - mrweasel 1y ago
    There's an absolutely massive disconnect between the technology Sam Altman is presenting in interviews and what is available. Like they're going to create an AI that will design fusion power plants, but right now they can't turn a profit on a technology that millions of people actually use in their day to day work? Can you sell enough ads to carry you through to the fusion capable AI? More and more OpenAI is drawing parallels to the Danish scandal of IT Factory. Self-proclaimed world leading innovation and technology in the front, financial sorcery in the back.
    - bee_rider 1y ago
      If they really believe their AI is going to be so great, I guess they can just ask it for a business model when it gets there. So their lack of business model is at least self-consistent.
      - _heimdall 1y ago
        Right now they may be a bit scarce on business plans and revenue, but I hear they're ushering in an era of "post-scarcity" so that should fix it.
      - exasperaited 1y ago
        That is more or less their actual plan. They ignore or want us to ignore that the technology is commoditising so fast that even if it is great, they won't have enough of an advantage for this to provide an edge for more than a matter of months. Just as Microsoft and anyone betting on AI data centre rollouts want us to ignore that the equipment they are rolling out will be functionally inadequate to support new models in far less time than they can make money to offset the cost; the only part of this capital expenditure that will provide lasting value is the building/power/cooling infrastructure, and probably not all of that. It's a giant money pit, funding a bunch of people who are not long off the crypto grift train if they are at all.
- amarcheschi 1y ago
  The switch from "Ai might kill us" to "you'll goon to Ai" was kinda funny, not gonna lie
  - decae 1y ago
    This may be the funniest comment I've ever read, considering the circumstances.
- gosub100 1y ago
  Porn is enormously profitable. This might just be the saving grace for AI. Historically, porn has been a pioneer in new tech industries (home video, online commerce, video and streaming). This time they aren't first to the game but don't underestimate the industry.
  - nativeit 1y ago
    Assuming it deals somehow with the folks who use it for revenge porn, deep fakes of non-consenting parties, and depictions of minors…has it said anything about doing that? Has anyone? Does anyone know the legal implications of generating mass quantities of sexual exploitation, or is this just another thing with AI that society will have to simply tolerate in the name of “progress”?
  - mrweasel 1y ago
    The saving grace here might be that you can hide your porn subscription in your monthly OpenAI subscription. Only question then: Will VISA and Mastercard cut off OpenAI for peddling porn? A quick search seems to indicate that the porn industry has a $100B in revenue per year, 20% of which is from subscriptions. If OpenAI consumed the entire global market for subscriptions, $20B, would that cover their yearly operational cost?
    - deleted 1y ago
      [deleted]
  - cube00 1y ago
    It's not as profitable as the original promise of AI to cut labour costs on a massive scale. Stockholders won't be happy.
- wongarsu 1y ago
  Just based on the number of ads I get for thinly veiled erotic chatbots, and the success sites like character.ai have with pretty bad LLMs, there has to be a lot of money in erotic LLM content. OpenAI turning to that market is a sign they are running out of easy investor money, but if they can survive the associated controversy without lobotomizing the models this sounds like a method to turn the entire company profitable over night. They might have to raise prices or abandon the flatrate model to deal with heavy users, but locking adult content behind separate plans might even increase acceptance Not sure if increased availability of LLM porn or the gradual erosion of LLMs with ads and sponsored content would be the greater evil on a societal level. Neither is particularly great. But they will certainly drive shareholder value
- throwaway314155 1y ago
  > OpenAI is starting to talk about ads and allowing "erotic" content I'm curious what you're referring to here. Did Sam Altman tweet something about this?
Mistletoe 1y ago
Surely nothing bad could happen by basing our entire economy and stock market health on these companies!
A_D_E_P_T 1y ago
They're in a tough place with respect to pricing. Qwen3 and DeepSeek's latest local models are too good and are practically free -- so if they try and jack up pricing to a level that ensures profitability, it won't work, as they're simply going to lose too many customers. There's a mechanism here similar to a Laffer Curve: Charge too much, they lose; charge too little, they lose. OAI needs to strike a delicate balance vs. surging low-cost competition.
whiplash451 1y ago
To be fair, MSFT is likely making a ton of money (or more likely, preventing churn) with their GPT-powered products for the enterprise. So the math is probably harder than it seems.
- cube00 1y ago
  Nobody really knows, they hide Copilot inside each of the business units and then claim it's too hard to split out.
- tcmart14 1y ago
  Would be totally a guess since as mentioned, they are not being too forth coming. But chances are, the inclusion of GPT into the products probably did not make those products any more profitable than before, and just make them more expensive to run. Everyone who would buy Sharepoint/dynamics 365 already has it. I doubt they saw a massive influx to the user base of these tools due to GPT. Have you heard of a massive influx of new Windows license being bought because og co-pilot? No, its just the normal churn of people upgrading their machines they were probably gonna upgrade soon anyways. The exception might be Azure with their LLM services.

mrweasel 1y ago

> They’ve never turned a profit Now that OpenAI is starting to talk about ads and allowing "erotic" content, I feel more comfortable in my prediction that not only have OpenAI never turned a profit, they never will. They will be consumed by Microsoft or crash the market so hard it's not even funny. The technology will survive, and it will be useful, but OpenAI as a company is done.

ed_elliott_asc 1y ago
Do you predict the same for Anthropic? Hopefully they will stick around.
- mrweasel 1y ago
  The problem, I think, is that IF OpenAI fail, they'll take with them a lot of other AI companies, simply because funding will be redirected away from the field entirely. If you're profitable, then you're probably going to be fine. If anything your operating costs will go down as there is less competition for staff and compute.
- Yizahi 1y ago
  If we go purely by economics, then Anthropic belongs to the same category of LLM corporations - ones which have only LLM as a product. As opposed to the likes of Google, Microsoft, even Facebook. Sure, these LLM-first corporations have a very tiny lead in both technology and (LLM) brand recognition, but it is shrinking fast. I suspect that only companies which will bundle LLMs with other big products (and do it cheaply) will survive in the long run.
alangibson 1y ago
This. If you really think you're a couple of years away from building Digital God, and today have virtually unlimited access to capital, you are not going to spend time shipping a sexy mode.
- thfuran 1y ago
  Why not do both if you have unlimited capital today?
  - Yossarrian22 1y ago
    Do they also have infinite labor?
    - nativeit 1y ago
      Isn’t the whole point of AI to replace labor? If they really want to put their money where their mouth is, they’d be casting off staff at a prodigious rate.
  - alangibson 1y ago
    Because you don't have unlimited attention
    - thfuran 1y ago
      But people have attention now, and it's surely quicker to make sexy mode than God.
ml-anon 1y ago
It’s amusing how “ads” is seen as an obvious way to make profit for OAI as if Google’s (especially) and Meta’s ads businesses aren’t some of the most sophisticated machines on the planet. Three generations of Twitter leadership couldn’t make ads on that platform profitable and that exposes far more useful user specific information than ChatGPT. The hubris is incredible.
- mrweasel 1y ago
  There's an absolutely massive disconnect between the technology Sam Altman is presenting in interviews and what is available. Like they're going to create an AI that will design fusion power plants, but right now they can't turn a profit on a technology that millions of people actually use in their day to day work? Can you sell enough ads to carry you through to the fusion capable AI? More and more OpenAI is drawing parallels to the Danish scandal of IT Factory. Self-proclaimed world leading innovation and technology in the front, financial sorcery in the back.
  - bee_rider 1y ago
    If they really believe their AI is going to be so great, I guess they can just ask it for a business model when it gets there. So their lack of business model is at least self-consistent.
    - _heimdall 1y ago
      Right now they may be a bit scarce on business plans and revenue, but I hear they're ushering in an era of "post-scarcity" so that should fix it.
    - exasperaited 1y ago
      That is more or less their actual plan. They ignore or want us to ignore that the technology is commoditising so fast that even if it is great, they won't have enough of an advantage for this to provide an edge for more than a matter of months. Just as Microsoft and anyone betting on AI data centre rollouts want us to ignore that the equipment they are rolling out will be functionally inadequate to support new models in far less time than they can make money to offset the cost; the only part of this capital expenditure that will provide lasting value is the building/power/cooling infrastructure, and probably not all of that. It's a giant money pit, funding a bunch of people who are not long off the crypto grift train if they are at all.
amarcheschi 1y ago
The switch from "Ai might kill us" to "you'll goon to Ai" was kinda funny, not gonna lie
- decae 1y ago
  This may be the funniest comment I've ever read, considering the circumstances.
gosub100 1y ago
Porn is enormously profitable. This might just be the saving grace for AI. Historically, porn has been a pioneer in new tech industries (home video, online commerce, video and streaming). This time they aren't first to the game but don't underestimate the industry.
- nativeit 1y ago
  Assuming it deals somehow with the folks who use it for revenge porn, deep fakes of non-consenting parties, and depictions of minors…has it said anything about doing that? Has anyone? Does anyone know the legal implications of generating mass quantities of sexual exploitation, or is this just another thing with AI that society will have to simply tolerate in the name of “progress”?
- mrweasel 1y ago
  The saving grace here might be that you can hide your porn subscription in your monthly OpenAI subscription. Only question then: Will VISA and Mastercard cut off OpenAI for peddling porn? A quick search seems to indicate that the porn industry has a $100B in revenue per year, 20% of which is from subscriptions. If OpenAI consumed the entire global market for subscriptions, $20B, would that cover their yearly operational cost?
  - deleted 1y ago
    [deleted]
- cube00 1y ago
  It's not as profitable as the original promise of AI to cut labour costs on a massive scale. Stockholders won't be happy.
wongarsu 1y ago
Just based on the number of ads I get for thinly veiled erotic chatbots, and the success sites like character.ai have with pretty bad LLMs, there has to be a lot of money in erotic LLM content. OpenAI turning to that market is a sign they are running out of easy investor money, but if they can survive the associated controversy without lobotomizing the models this sounds like a method to turn the entire company profitable over night. They might have to raise prices or abandon the flatrate model to deal with heavy users, but locking adult content behind separate plans might even increase acceptance Not sure if increased availability of LLM porn or the gradual erosion of LLMs with ads and sponsored content would be the greater evil on a societal level. Neither is particularly great. But they will certainly drive shareholder value
throwaway314155 1y ago
> OpenAI is starting to talk about ads and allowing "erotic" content I'm curious what you're referring to here. Did Sam Altman tweet something about this?

Mistletoe 1y ago

Surely nothing bad could happen by basing our entire economy and stock market health on these companies!

A_D_E_P_T 1y ago

They're in a tough place with respect to pricing. Qwen3 and DeepSeek's latest local models are too good and are practically free -- so if they try and jack up pricing to a level that ensures profitability, it won't work, as they're simply going to lose too many customers. There's a mechanism here similar to a Laffer Curve: Charge too much, they lose; charge too little, they lose. OAI needs to strike a delicate balance vs. surging low-cost competition.

whiplash451 1y ago

To be fair, MSFT is likely making a ton of money (or more likely, preventing churn) with their GPT-powered products for the enterprise. So the math is probably harder than it seems.

cube00 1y ago
Nobody really knows, they hide Copilot inside each of the business units and then claim it's too hard to split out.
tcmart14 1y ago
Would be totally a guess since as mentioned, they are not being too forth coming. But chances are, the inclusion of GPT into the products probably did not make those products any more profitable than before, and just make them more expensive to run. Everyone who would buy Sharepoint/dynamics 365 already has it. I doubt they saw a massive influx to the user base of these tools due to GPT. Have you heard of a massive influx of new Windows license being bought because og co-pilot? No, its just the normal churn of people upgrading their machines they were probably gonna upgrade soon anyways. The exception might be Azure with their LLM services.