Posted August 14, 2023
By Ray Blanco
Where’s All The Money In AI?
I thought AI was supposed to be a gold mine…
Nvidia and Advanced Micro Devices have seen their stocks soar on the backs of their high-powered hardware that’s been used to run artificial intelligence programs.
Experts have also predicted that the value of AI could measure in the trillions.
Then why is the company that started the public’s fascination in artificial intelligence, OpenAI, staring down the barrel of bankruptcy?
After OpenAI debuted their AI chatbot ChatGPT in November, they attracted new users at a record pace. By February they topped 1 billion monthly visits and continued to increase their traffic until May.
But after topping out at an impressive 1.9 billion monthly visits, traffic has only declined.
June and July both saw a drop of about 200 million visits. This was explained away as being because students on summer vacation no longer needed ChatGPT to write papers for them.
Whatever the reason, OpenAI is bleeding money.
The company has yet to effectively monetize their extremely popular chatbot and in May they saw their losses double to a brutal $540 million.
Early revenue estimates are beginning to look unrealistic. CEO Sam Altman said he expected OpenAI to earn $200 million in 2023 and $1 billion in 2024, but so far the losses are only piling up.
With new competitors showing up every day, such as Anthropic’s surprisingly advanced ChatGPT-clone Claude, and Meta’s open-source Large Language Model LLaMa, OpenAI’s profitability is looking far from certain.
A new obstacle the AI pioneers are facing is that, contrary to expectations, ChatGPT may actually be getting…dumber.
In Friday’s issue of Technology Profits Daily, we covered how ChatGPT is answering math questions incorrectly that it had no trouble with just a few months ago.
While OpenAI won’t have trouble keeping the lights on for the time being, considering their $10 billion investment from Microsoft, there has to be growing concern that AI might not be the cash cow it was made out to be.
There is clearly plenty of money in the picks-and-shovels of the AI gold rush, just ask the companies making microchips, but is there actually gold in them there hills?
Here are the stories that have my attention this week.
AI Mania Triggers Dot-Com Bubble FlashbacksNvidia shares have nearly tripled this year. Investors question whether the stock can live up to the hype. Read more… |
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Regulators give green light to driverless taxis in San FranciscoCalifornia regulators gave approval to two rival robotaxi companies to operate their driverless cars 24/7 across all of San Francisco. Read more… |
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Rise of the machines: AI spells danger for Hollywood stunt workersHollywood's striking actors fear that artificial intelligence is coming for their jobs. Read more… |
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New US tech restrictions on China have investors wary, watching for retaliationThe Biden admin's proposed rule would ban some U.S. investments and require disclosure of others involving sensitive tech like advanced computer chips and AI. Read more… |
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Biden’s green energy law is turning out to be hugeThe biggest sleeper event of the Biden presidency may end up being the laughably misnamed and poorly understood Inflation Reduction Act. Read more… |