OpenAI, the research company responsible for the development of popular language models such as ChatGPT and Dall-E 2, has experienced a significant increase in losses, doubling to $540 million in 2022. The losses stem from soaring development expenses for its AI chatbot and increasing competition for skilled staff, according to a report by The Information. In response to the situation, OpenAI is looking to raise as much as $100 billion in the coming years to fund its goal of developing artificial general intelligence (AGI), an AI advanced enough to improve its own capabilities.
“The previously unreported figure reflects the steep costs of training its machine-learning models during the period before it started selling access to the chatbot,” The Information reported. The high costs of employing skilled staff like engineers and research experts from companies like Google have also contributed to OpenAI’s losses. Additionally, the cost of training machine-learning models and acquiring fresh data sets is expected to escalate as more customers adopt AI technology and the company develops future versions of its software.
While OpenAI’s revenue has increased, reaching an annual pace of hundreds of millions of dollars shortly after launching a paid version in February, the costs are likely to keep rising. Data costs are also anticipated to skyrocket as platforms like Reddit and StackOverflow introduce policies that charge AI firms for access to their previously free data sets. This is likely to further strain the company’s financial position.
Sam Altman, CEO of OpenAI, has suggested that the company may attempt to raise $100 billion to achieve its AGI goal, a move that some experts believe could lead to a monopoly on AI. OpenAI has already taken steps in this direction by purchasing the domain AI.com and filing for a trademark on ‘GPT.’ However, acquiring fresh data sets for its software remains a challenge, as companies like Samsung are concerned about their proprietary data entering the ChatGPT data pool.
Elon Musk, co-founder of OpenAI, tried to assume the role of CEO in 2018 but was met with resistance from Altman and others. Musk has expressed concerns that OpenAI’s profit incentives could compromise the ethical development of AI models. In response to OpenAI’s situation, Musk tweeted, “That’s what he (Altman) told me” when referring to the company’s plans to raise $100 billion.
Despite leaving OpenAI, Musk continues to be involved in AI, recently creating a new company called X.AI that aims to promote AI in the ChatGPT era. OpenAI recently closed a share sale worth more than $300 million at a valuation between $27-$29 billion, highlighting the continued interest in the development of AGI and the potential benefits it could bring.
