Feature
The Gist
- Cost reduction. OpenAI cut costs of GPT-4o by 50%, aiming for widespread use and dominance.
- Free upgrades. ChatGPT's free version upgraded to GPT-4o to revive growth and user interest.
- Strategic partnerships. OpenAI’s partnerships with Apple and Microsoft strengthen its market position.
In a season of big AI news, few moments have felt more significant than this one. OpenAI introduced its new GPT-4o model last week, Google unveiled a deeper AI vision, and Apple dropped more hints ahead of a massive AI-themed Worldwide Developers Conference (WWDC) event.
I spoke with Box CEO Aaron Levie at a live Big Technology Podcast recording recently about what it all meant. Amid the noise, here are the five core takeaways, including some commentary from Levie on crucial developments the headlines seemed to miss:
OpenAI Wants to Get Big Fast
OpenAI cut the cost of using its newest GPT-4 model by 50% and made it twice as fast as the previous version. By doing so, it’s practically daring companies considering building with its technology to give it a chance, hoping to get big fast. ROI spreadsheets are likely getting reworked as we speak.
“We're nowhere near the point where a lowering of cost doesn't disproportionately impact what you can now build,” Levie said.
OpenAI’s strategy to get its technology in the hands of as many developers as possible — to build as many use cases as possible — is more important than the bot’s flirty disposition, and perhaps even new features like its translation capabilities (sorry). If OpenAI can become the dominant AI provider by delivering quality intelligence at bargain prices, it could maintain its lead for some time. That is, as long as the cost of this technology doesn’t drop near zero.
Related Article: Generative AI Might Be Slamming Right Into a Resource Wall
Free ChatGPT-4o Is a Risky Bet With Upside
OpenAI is also betting that ChatGPT will get big fast, upgrading its free version by two generations to GPT-4o. That might disincentivize some users from paying $20 per month for ChatGPT Plus. But ChatGPT needs the jolt more than OpenAI needs the money.
ChatGPT’s growth has flatlined, and OpenAI’s latest announcement revived interest in the product. Sticking free ChatGPT users with an inferior bot would squander the buzz, so OpenAI is making ChatGPT-4o available to everyone for free. Hardcore users will likely remain on the paid version, looking for higher rate limits and other perks. But even if OpenAI loses a few Plus subscribers, the tradeoff should be worth it.
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An Apple + OpenAI Partnership Is Brewing
OpenAI released a desktop app as well, surprisingly debuting it on Mac. Despite Microsoft funding OpenAI with billions of dollars, the company passed over Windows, telling Axios it’s debuting the app on Mac because that’s where most of ChatGPT’s users are. The partnership is further indication of a deepening bond between OpenAI and Apple, as reports indicate that Apple will build OpenAI’s GPT technology into its mobile iOS. A tight integration with Apple could leave OpenAI with a strong position in consumer technology via the iPhone and an ideal spot in enterprise via its partnership with Microsoft.
Managing these two relationships could be tricky for OpenAI. The folks in Redmond, who are building their own powerful LLMs, likely aren’t thrilled about being left out. Microsoft CEO Satya Nadella did not appear at OpenAI’s event, something he’s done in previous releases.
Related Article: Will Search Be Generative AI or Blue Links? Actually It's Both
The Web Is Probably Going to Be Fine
Google is now putting “AI Overviews” on top of some search results, but the obituaries for the web are somewhat premature. Google, like Perplexity and Yahoo, will likely show AI-generated results for only a certain percent of queries.
AI-generated answers aren’t a dramatic improvement from standard search in most cases (at least for now), and the data is telling. Bing still owns only 3.6% of the worldwide search market, even as its Copilot provides AI answers upon request. And so, the web will live on.
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AI Safety in Limbo
OpenAI’s chief scientist Ilya Sutskever resigned recently, along with its “superalignment” co-leader Jan Leike. It follows a pattern. After spending significant time listening to those concerned with safety, the AI industry seems to be paying them less attention. AI critics have, in some ways, sidelined themselves with fanciful arguments and arrogance. But as this technology gets more powerful, the safety conversation is going to grow more important. Though it will likely have to adjust to move forward.
After I asked Levie when an all-powerful AI might arrive, he seemed relieved we haven't seen it so far. “We should probably be glad that we don't have this breakthrough AGI experience yet,” he said. “We actually need some time to just pace ourselves, frankly.”
