alt Hacker NewsWhat I think is really incredible about this is that they are selling a ton of subscriptions, both personal and business subscriptions. So the fact that they are doing advertising on top of this suggests to me that they are in a deep deep hole, much deeper than he probably would have imagined when making this statement. If your revenue is 25 billion and you still need ads, your costs must be running you down at a pace you really didn't anticipate.
Replies
> If your revenue is 25 billion
It isn't. They had a one-month period around February that, if every month ran like taht, would constitute a yearly revenue of 25 billion. The fact that they appear to not have published a new annualized revenue number since then suggests that the trend is not upwards, which would make sense with the growing number of companies that are asking questions about ROI on AI expenses and cutting their token spend.
Or they ran the numbers and saw that they'll make more money with ads than without. I doubt they care about anything but the bottom line.
I think a lot of people are missing the fact that this is for the free tier, not their subscriptions.
OpenAI has an unbelievable number of free users. People paying $20 a month or more are in the minority.
It’s not cheap to serve LLMs to hundreds of millions of users for free. They either cut the free tier or add ads to cover the costs.
Extrapolations about OpenAI being in dire financial straights are generally coming from people who don’t understand the extreme scale of their free plan or who didn’t read far enough to understand that the ads aren’t going into the $20 plan everyone knows.