OpenAI, the developer of ChatGPT, is struggling to keep up with its competitors in the rapidly evolving AI landscape. The company’s lead in the market has evaporated since 2022, when its chatbot gained widespread popularity and sent Google into a panic. In response, OpenAI signed deals with Microsoft and Apple to integrate its technology, but these efforts have not paid off.
Recent setbacks, including DeepSeek’s R1 chain-of-thought model and Gemini 3 Pro from Google, have dealt significant blows to OpenAI’s progress. The company has released new models, such as GPT-5, but they have failed to impress users, leading to complaints about mistakes and lack of personality. This has allowed competitors like Anthropic and Elon Musk’s xAI to surpass OpenAI in various benchmarks.
OpenAI’s financial situation is also concerning. The company relies heavily on external funding to stay afloat, with revenue growth projected at around $20 billion annually by 2030. However, this growth strategy comes with risks, including inflation and supply chain issues that could drive up costs for server-grade computer components, affecting consumer electronics.
Experts warn that the AI bubble may burst if it does not stabilize, potentially wiping out $20 trillion in wealth held by American households. For OpenAI to prove its value, Sam Altman must demonstrate significant improvements in its technology and business model, as the company faces an uncertain future.
Source: https://www.engadget.com/ai/openais-house-of-cards-seems-primed-to-collapse-170000900.html