US Treasury Secretary Yellen rules out bailout for bankrupt Silicon Valley Bank
"During the financial crisis, there were investors and owners of systemic large banks that were bailed out," Yellen said.
The AI-enabled ChatGPT owner may go bankrupt by the end of 2024 as its investors could turn off the tap if the Sam Altman-led company doesn’t turn to profit. This was disclosed by a recent report published in Analytics India Magazine.
The roughly $700,000 per day costs the Open AI incurs on running ChatGPT and Microsoft are borne by the recent investors from their own pocket.
It is to be noted here that in May this year, OpenAI’s losses doubled to $540 million ever since it started developing ChatGPT.
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“Microsoft’s $10 billion investment in OpenAI is possibly keeping the company afloat at the moment. But on the other hand, OpenAI projected an annual revenue of $200 million in 2023, and expects to reach $1 billion in 2024, which seems to be a long shot since the losses are only mounting,” it further stated.
According to the report, shrinking user visits to ChatGPT website and the recently-released data of Similar Web showed that after hitting a record high of 1.9 billion user visits in May this year, the generative AI chatbot witnessed 1.7 billion user visits in June and only 1.5 billion in July.
The report further mentioned a user on social media platform X, who argued a major reason for the decline in visits to ChatGPT website could be API cannibalisation wherein most companies are prohibiting employees from using the generative AI chatbot for work, but are allowing them to use the API to leverage the large language model (LLM) in other workflows.
Countering this claim, the report said, “It is rather presumptuous of OpenAI to assume that the decline in users is just because people have started using the API to build their own products. Interestingly, the twist over here is the rise of open source LLM models. Meta’s Llama 2, in partnership with Microsoft, is allowing people to use the model for commercial purposes.”
The report noted that even though CEO Sam Altman does not own equity in OpenAI, the company shifted from being a non-profit to a profit way back.
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