I don't know how you can write down those numbers and come to the conclusion they sound reasonable at all. Corporations literally can't give this trash away for free without consumers being unhappy about it (eg. the Copilot malware infesting every aspect of Windows). ChatGPT had 800m MAU at one report, but that's a chat interface and free. Do you really believe over half of those users are going to convert from "free" to paying $60/mo for access to the chat interface, when all potential applications for actually improving their lives are failing badly? I think you are out of touch with the finances of non-tech-indsutry workers if you think they will.

I don't know a single person in my (non-tech!) life that doesn't use AI, shy of toddlers and geriatric people.

The famous MIT study (95% of AI initiatives fail, remember that one?) actually found that pretty much every worker was using AI almost daily, but used their personal accounts (hence the corporate ones not being used).

If you are brand new to the tech world, and this is your first new product cycle, the way it works is that there is a free-cool-we're-awesomely-generous phase, and then when you are hooked and they are entrenched, the real price comes to fruition. See...pretty much every tech start-up burning runway cash.

Right now they are getting us hooked, and like the dumbasses consumers are, they will become totally dependent and think it will stay this cheap.

A good way to think about it is that ChatGPT is well on its way to becoming a verb like Google did. Doesn't roll off the tongue as easily but in terms of brand awareness it feels ubiquitous.

I use AI frequently. I am frequently let down. Occasionally satisfied and very rarely impressed. My results seem typical for everyone else I know. It's a free and widely promoted tool that has the potential to be useful, of course people will use it. The features I find most useful, is not providing me new knowledge. It's formalizing something I wrote or summarizing some other text, that I am going to read anyway or can at least reference as needed and confirm the output. This is also where the local models Excel.

I also often see people post AI generated advice and answers that are simply incorrect in Facebook groups and get roasted with 100s of people chiming in on how you can trust ChatGPT.

I just can't see regular people are going to pay more than (NetFlix + HBO + Prime + WM+) for an AI subscription. I think you would see tons of competitors pop up if that were at all viable.

> actually found that pretty much every worker was using AI almost daily

What they found is that people search the Internet for things and an AI bot is right there. What they didn't find is people using Vibe coded apps, learning from AI or buying AI services. They did find companies buying AI services, but as an experiment. Also, blaming AI is easy when someone messes up and costs a customer or sale. The more that happens, the sooner the company stops experimenting. If that happens in a widespread way, then this bubble collapses.

You sound very naive.

"If you are brand new to the tech world, and this is your first new product cycle, the way it works is that there is a free-cool-we're-awesomely-generous phase, and then when you are hooked and they are entrenched, the real price comes to fruition. See...pretty much every tech start-up burning runway cash."

That has indeed been the strategy, but it's not like it always or even usually works out. We've seen plenty of companies that try to raise their prices and people aren't hooked. (Though I am almost certain in this case at least professionals if not the general public will indeed be hooked.)

If you really don't know a single such person, you live in a very odd bubble. I know lots of people who used ChatGPT a lot when it first came out, found it funny and occasionally useful, then changed their mind to just finding it funny occasionally, and then eventually stopped because it wasn't that useful and was no longer funny.

None of them ever considered getting a paid account, nor would they have. I'm not saying nobody will, but if you actually don't know any such people then there is something unusual about the crowd you run with.

> I don't know how you can write down those numbers and come to the conclusion they sound reasonable at all.

Half this board is in the most hyped echo chamber I’ve ever seen.

> ChatGPT had 800m MAU at one report, but that's a chat interface and free. Do you really believe over half of those users are going to convert from "free" to paying $60/mo for access to the chat

Even if these things worked great for everyone, the percent of free uses who convert to paid users is low single digits per cent. For OpenAI to have any chance of breaking even in the consumer space, they need to develop an ad biz that makes around 20-25% of G does. That's a tall order in that G doesn't make good dough from search anymore as SERP page clicks are down 80% with AI summaries being good enough for most.

And let's not forget that for the bubble to sustain itself, people would currently use different LLMs would need to create a separate account in each one. There's absolutely no way most people will be paying more than one LLM unless they have a lot of disposable income.

Just like all feemium, it’s supported by power users.

I pay for gpt myself, and my work pays for Copilot, GPT, Claude, cursor, Glean, and other enterprise tools. And we make enterprise tools on top of AI that our customers pay extra for.

Averaging the revenue over headcount isn’t the right model, anymore than it would be for RIOT games or YouTube.

fair enough, but the consumer is already stretched. So where is this $60-80 per month X 500MM consumers coming from?

Consumer spending is strong and growing, don't listen to dregs milking upvotes on the internet, people will easily come up with 4-5 hours of minimum wage pay in a month to cover the cost of the thing they use many times a day.

I don't use AI for anything in my private life, only at work. And I can't really imagine what it could do for me. In no scenario am I paying a monthly subscription for it.

I know someone who doesn't have a smart phone

I don’t know how this can be true when almost everyone I know is struggling right now

Two tier economy

Wait how? Show your work. I still see at least a $600bn gap.

> Something they find as indispensable as a cell phone or internet bill.

Source?

Why not reply than just downvote? Seems cowardly.

500,000,000*80=40,000,000,000 40,000,000,000/650,000,000,000=0.06

If I understood you correctly and my math is correct, your suggestions only cover 6% of 650 billion, the news is suggesting AI companies need more than 10x more. So either it's 5 billion people paying 60-80, or 500 million people paying 600-800/month, or something in between + a little extra.

The payback period would be 5-10 years at those prices($60-$80/mo), which is pretty normal.

Isn't the 650 billion required per year, so the monthly cost is automatically 12x

You're right!

But we're still short on 26%

No, they won't be. Inference costs will continue to drop, and subscription prices will follow as AI is increasingly commoditized. There are 6 different providers in the top 10 models on openrouter. In a commoditized market, there will be no $60/month subscriptions.

Which is good right?