back to article Even at $200/mo, Altman admits ChatGPT Pro struggles to turn a profit

Even at $200 a month for ChatGPT Pro, the service is struggling to turn a profit, OpenAI CEO Sam Altman lamented on the platform formerly known as Twitter Sunday. "Insane thing: We are currently losing money on OpenAI Pro subscriptions!" he wrote in a post. The problem? Well according to @Sama, "people use it much more than …

  1. IGotOut Silver badge

    And I've...

    ...a swimming pool of snake oil to sell you.

  2. Sora2566 Silver badge

    Sadly, as long as the VC money-taps are open, OpenAI won't go anywhere no matter how huge its losses are.

    1. UnknownUnknown

      If AI so smart, why isn’t it making money out of crypto, shares, derivatives, currency differentials, analysis performance etc … instead of making fake pictures of women with giant asses/tits for clicks ad micro-revenue and magic matcha weight loss tea.

  3. Mentat74
    Facepalm

    "people use it much more than we expected."

    For what exactly ?

    Something that's actually productive and makes people money ?

    Or is it just frivolous marketing b.s. ?

    1. MachDiamond Silver badge

      Re: "people use it much more than we expected."

      "For what exactly ?"

      Party tricks.

      I was talking to somebody that thought it was the bug's nuts, but couldn't demonstrate anything worth money. "Oh, but it can do this analysis...." The answer was something I could guess within a close order which was good enough for what we were talking about.

      1. Joe W Silver badge
        Alien

        Re: "people use it much more than we expected."

        Our role playing dungeon master (Icon: Contact!) uses some of that stuff to generate fluff text. Works.

        Just... it does not work for doing, well, work. Despite what Hypeman (or one of the C-suits in this company here) say.

        1. Richard 12 Silver badge

          Re: "people use it much more than we expected."

          A lot of marketing is fluff text, so...

          I am wondering which LLM wrote Altman's blog post

  4. Andy 73 Silver badge

    Don't worry..

    We might lose money on every sale, but we'll make it up in volume!

    So far LLMs regurgitate a fractured version of what we already know... with added maths errors and hallucinations (or 'false facts'). I can't see how this can be used for any form of robust generation of new information (key word robust).

    Sure, we can (inaccurately) summarise texts and dream up images of Sam Altman riding a unicorn, but... apart from the Labour party wanting to generate tone-deaf adverts, who is going to pay a premium rate for that?

    1. Jellied Eel Silver badge

      Re: Don't worry..

      So far LLMs regurgitate a fractured version of what we already know... with added maths errors and hallucinations (or 'false facts'). I can't see how this can be used for any form of robust generation of new information (key word robust).

      There's an interesting example of AI with Lex Fridman's interview with Ukraine's Zelensky. If you pick US English, you'll be treated to an AI auto-dub that attemps to use their voices, but ends up with a rather uncanny valley effect. But also demonstrates the AI potential of creating 'deepfakes', or why celebs are complaining about AI voice clones. Same problem happens with the a lot of the AI generated videos on YT. They sound vaguely human, but not quite right.

  5. Michael Hoffmann Silver badge
    Facepalm

    People use it more than we expected?

    What happened to "we make the profits at scale, man" tech bro mantra?

    1. doublelayer Silver badge

      Re: People use it more than we expected?

      He evidently expected that this would be the kind of product where people buy it but don't use it, so you can afford to serve the higher users from the savings on the low users. Like unlimited storage packages, where many users buy them and store 200 GB in them, so you can afford a few 30 TB users. Altman seems unaware that someone who is willing to pay $200 per month probably expected to use the services kind of a lot, and anyone who didn't use them too often saw that pricing and left. Sorry Sam, that price is out of the range for people who might use this and are willing to pay a bit to have the option available.

      1. MachDiamond Silver badge

        Re: People use it more than we expected?

        With Siri and Alexa being free (for a certain amount of free), the question is whether people will pay $200/month for a plus version. I don't use any of those and I've had no luck with ChatGPT being able to find information that I was looking for, but suggesting things I endeavored to exclude from results.

        1. doublelayer Silver badge

          Re: People use it more than we expected?

          But you do know that whoever is willing to pay $200 for a plus version is going to use the plus version a lot. It would have made a lot of sense if OpenAI had somehow deluded themselves into thinking that tons of people were going to buy their plan, but not many did, so they got little money for their trouble. The thing those payments are for cost quite a bit to create, after all. What makes a lot less sense is why they're surprised that the people who bought this are using it, and using it so much that they're losing money on that subscription. That's a clear indicator that they did not think through what it cost to deliver the service they were charging for, which is a much more basic mistake.

          1. tiggity Silver badge

            Re: People use it more than we expected?

            Maybe they consulted AI before implementing it and the AI reassured them there would be low usage?

    2. breakfast

      Re: People use it more than we expected?

      Fifteen years of not making profits at scale either, combined with having to pay interest on all those loans, one assumes.

  6. Androgynous Cow Herd

    I would like to take this opportunity to point out...

    1. Oh, bullshit!

  7. JRStern Bronze badge

    So tell us already, how much is enough?

    How far off are things?

    Would $300/month turn it around?

    $2,000 a month?

    More?

    Is more use a sign of great results or terrible results so people keep trying to get something useful?

    Does it do better pr0n?

  8. beast666 Silver badge

    Altman should be in prison.

    Lock him up.

    1. Anonymous Coward
      Anonymous Coward

      Re: Altman should be in prison.

      His sister should probably be in prison. Or at least some kind of institution.

  9. DS999 Silver badge

    When you sell "unlimited" anything

    You can't necessarily make it truly unlimited if you want to turn a profit. That's been true whether it is unlimited data or unlimited shrimp!

  10. Ball boy Silver badge

    So hold on: is the standard model is giving me bad answers?

    For the extra cash, users gain unlimited access to its advanced voice, o1 pro model, "which uses more compute for the best answers to the hardest questions."

    Translation: pay $20/month subs. and the answers you get get might not be very good*. Given that experience, why would someone willingly pay more? Shirley the better approach would be to give the users the best answers but tack on a 'but you can't ask any more questions on your current subs. rate: you need to upgrade' rather than fob people off with information you freely admit might not be your best guess*?

    *for 'very good' and 'best guess' read: whatever hallucination the AI can deliver, given the topic.

  11. Anonymous Coward
    Anonymous Coward

    Pure genius

    "personally chose the price and thought we would make some money"

    Wow, a true genius business mind, stick finger in the air and guess!

    Well, I'm guessing that the same method is used to predict his chances of developing general AI, they should have left him in the sacked state, not only better for the company but for the planet too.

  12. Anonymous Coward
    Anonymous Coward

    Route to profit

    Is his route to profit to get his AI to invent everything, then patent everything and finally end with rent-seeking everything?

  13. amanfromMars 1 Silver badge

    Sam Altman and OpenAI are just as Follower Disciples of Out of this World Leaderships ‽ .

    And that question asked of Sam Altman and OpenAI is prompted with particular and peculiar regard to the surely clear enough fact of the extreme similarity, [which I would hesitate to proclaim be any sort of something approaching Singularity], between their pending foray revealed here .......

    If AGI weren't enough, Altman claims OpenAI is beginning to turn its attention to "superintelligence," which, if the genAI hype man is to be believed, will "massively accelerate scientific discovery and innovation well beyond what we are capable of doing on our own, and in turn massively increase abundance and prosperity.”

    ....... and a present day, current running, NEUKlearer HyperRadioProACTive ITeration shared earlier [Sun 5 Jan 05:51] here on El Reg .....

    ...which always results in Unusual Unofficial Undergrounds that are simply able to stealthily enable relatively anonymous and practically autonomous AIDevelopment and Remote Spooky Distant Assistants for the protection and servering of Overwhelming Resource Traffic for Super Creative Official Opposition Resistance.

    Welcome to the Hood, Sam/OpenAI. Nice to see you, to see you, nice.

  14. Irongut Silver badge

    The firm still has some runway... but it is a little short

    > the firm still has some runway, having just raised $6.6 billion in new funding back in early October

    Given OpenAI made $3 billion on $5 billion revenue last year, that $6.6 billion won't even last them 12 months.

  15. Wang Cores

    Another beggar. At least he's only bilking the private investors like Saylor Moon.

  16. OrientalHero
    Angel

    "this process is obscured in OpenAI's o1 models through a pause while it's "thinking." In the end, only the final answer is provided to the end user."

    Is no-one else reminded of a particular computer in a particular trilogy in 6 parts by a late author known as Douglas Adams?

    I mean the copyright probably prevents it (SHE thinks) but calling the new ChatGPT Deep Thought and have it say "I'm thinking" all the time before it delivers it's final answer would be funny to me at least...

  17. Anonymous Coward
    Anonymous Coward

    It's probably not supportable on the backs of 3 paid users.

  18. Zippy´s Sausage Factory

    "Insane thing: We are currently losing money on OpenAI Pro subscriptions!"

    Tell me again how this is the future of computing and not some expensive gewgaw that'll be put in the cupboard along with "blockchain everywhere" soon enough?

  19. sanmigueelbeer

    Pffft! Noobs!

    Do what Broadcom did to VMWare and adjust the price to $20,000/month.

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