OpenAI is losing money on its $200/month ChatGPT Pro plan due to higher-than-expected usage.
OpenAI projects $100 billion in revenue by 2029 and is considering raising subscription prices.
OpenAI is reportedly considering price hikes for subscription.
OpenAI offers premium plans for regular users without any limits. Previously, the company introduced the ChatGPT Pro, which offers almost unlimited access to ChatGPT tools but comes at a high monthly cost of $200. The plan also includes exclusive access to the new O1 Pro model, which has more computing power to provide answers. In the most recent update, OpenAI CEO Sam Altman revealed that the company is losing money on the Pro Plan.
Taking to X, Altman stated that the company is losing money on its $200-per-month ChatGPT Pro plan because people use it more than expected. According to reports, the tech executive admitted that he personally determined the price of the premium subscription service, underestimating the plan’s widespread usage and associated costs.
For those unfamiliar, the ChatGPT Pro subscription provides unlimited access to tools such as Sora, a video generator, and the others mentioned above. Despite its high cost, the plan has gained popularity among users due to its diverse use cases. This heavy usage has put a financial strain on OpenAI. Altman stated that he initially expected that the service would be great for profits, but becoming a financial burden.
READ: OpenAI in 2024: ChatGPT Search, Sora AI video, and all the big wins
“Insane thing: we are currently losing money on OpenAI Pro subscriptions! People use it much more than we expected,” he stated in his tweet. This comes after the ChatGPT maker has raised more than $20 billion since it was founded. Even after the massive investment, the company has yet to turn a profit because a significant portion of the funds are spent on employee salaries, office rent, and the massive infrastructure required for training AI models. According to the report, the ChatGPT alone cost OpenAI an estimated $700,000 per day.
On the other hand, the company is working on the model and wants to turn it into the for-profit model in order to sustain but is getting criticism from popular giants including Elon Musk. Some reports also claim that OpenAI is also considering price hike to turn profitable.
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Ashish Singh
Ashish Singh is the Chief Copy Editor at Digit. Previously, he worked as a Senior Sub-Editor with Jagran English from 2022, and has been a journalist since 2020, with experience at Times Internet. Ashish specializes in Technology. In his free time, you can find him exploring new gadgets, gaming, and discovering new places. View Full Profile
