Really their biggest risk is total compute costs falling too quickly or poor management.
As long as we’re talking independent revenue streams it’s worth counting separately from an investment standpoint.
I don’t think it’s very likely, but think of it like an auction. In a room with 100 people 99 of them should think the winner overpaid. In general most people should feel a given startup was overvalued and only looking back will some of these deals look like a good investment.
I'd be surprised it that was the case. How many tokens is the average user going through? I'd be surprised if the avg user even hit a 1m tokens much less 20m.
Voice mode is around $0.25 per minute via API. I don't use that much, but 3 minutes ago per day would already exceed the cost of a ChatGPT Plus subscription by quite a bit.
I’m not sure I understand this, sorry. I see GPT-4o at $3.75 per million input tokens and $10 per million output tokens, on OpenAI’s pricing page.
That’s expensive and I can’t see how they can run Copilot on the standard API pricing. But, it makes a message (one interaction?) lower cost than $4 to me.
How many tokens are in a typical message for you?
Even for regular old 4o: You’re comparing to their API rates here, which might or might not cover their compute cost.
I wouldn't even be surprised if they were losing money on paying ChatGPT users on inference compute alone, and that isn't even factoring in the development of new models.
There was an interesting article here (can't find the link unfortunately) that was arguing that model training costs should be accounted for as operating costs, not investments, since last year's model is essentially a total write-off, and to stay competitive, an AI company needs to continue training newer frontier models essentially continuously.