Whether it be to generate an idea, to review content or make a silly image, AI has been a big help to us. Ever since the boom of ChatGPT in January 2023, AI has been a major part of life. Controversial things such as AI Art, Copyright laws, questionable AI/ML training and AI misuse have always been there but were resolved by ChatGPT’s owning entity, OpenAI. Recently, Sam Altman, the CEO of Open AI tweeted the following:
Shortly after, their “Plus” tier subscription had numerous features revoked, and a new plan “Pro” was debuted. Plus’ pricing wasn’t changed, however it seems like OpenAI has inflicted numerous ‘restrictions’ on the platform for Plus users.
Originally, the idea behind Plus was to allow users more freedom and features with ChatGPT. Plus would allow you early access to their improved models (Such as 4o and o1) and features such as Image Generation, File Generation and Editing, and more.
It’s seemingly predatory to just remove features people pay for overnight with little to no notice aside from a single twitter post. Why raise prices? Why claim that the company is ‘losing money? For a platform with over a billion users, $20/mo for even just half of that would warrant over $10000000000/mo in revenue. The $200/mo pro plan just kind of sounds like “O1 Pro tier” without any justifiable features, it’s just an additional money grab for the company.
The question is, is this corporate greed? Let’s look into OpenAI’s operating costs. Based on a report by “The Information”, a news outlet for anything tech, it is estimated that OpenAI is spending upwards of $7B per year on employee expenses and Microsoft server costs to run ChatGPT on. Tasks such as AI Model training require a significant amount of GPU processing power, which is extremely expensive, Nvidia A5000 GPU’s (often used for AI training and generation) are around $1500 per card and use a lot of electricity, which in turn is a hefty bill for Microsoft, and then OpenAI.
OpenAI’s payment processor, Stripe also takes their own cut, digital purchases usually are around 2.9% + 30¢ per transaction which then takes another cut of their income, adding this all up makes it seem that OpenAI’s ChatGPT is a “loss leader”, a product which is designed for public exposure and usage that generates a loss for the company, which was proven by their 2024 financial report, reporting a $5B loss in 2024.
However it looks like it’s going up for the company. They’re seemingly aiming towards more corporate / government contracts, integrating ChatGPT into many large products, such as the iPhone and other Government tools. Maybe the price hike isn’t corporate greed but instead a way to maintain investor cash-influx and ensure the company stays afloat.
Overall while the company may seem predatory, the price is more than justifiable as the usage of ChatGPT is extremely expensive for users who truly utilize it, OpenAI needs to recover a large chunk of the loss they’re receiving on their current pricing.
