ChatGPT Plus cost may surge 2X by 2029, experts predict

ChatGPT Plus price hike on the horizon: OpenAI’s popular AI chatbot service, ChatGPT Plus, is expected to see significant price increases over the next five years, potentially more than doubling its current cost.

• The current monthly subscription fee for ChatGPT Plus is $20.
• According to internal OpenAI documents cited by The New York Times, the first price increase of $2 per month is anticipated before the end of 2024.
• By 2029, the monthly cost could reach $44, representing a substantial 120% increase from the current price point.

Financial pressures driving the decision: The projected price hikes are largely attributed to the substantial costs associated with operating and improving the AI service, as well as OpenAI’s current financial situation.

• OpenAI is reportedly “burning through piles of money” and is expected to incur a staggering $5 billion loss in 2024.
• Despite generating monthly revenue of $300 million, the company remains firmly in the red financially.
• Annual sales projections paint a more optimistic picture, with expectations of $3.7 billion this year and $11.6 billion next year.

User base and funding efforts: While ChatGPT Plus has attracted a significant user base, OpenAI is actively seeking additional funding to support its operations and growth.

• Approximately 10 million people currently subscribe to ChatGPT Plus.
• OpenAI is pursuing $7 billion in outside funding, which would value the company at an impressive $150 billion.
• This funding push comes amid recent leadership changes, with three executives departing the company.

Ongoing improvements and feature rollouts: Despite financial challenges, OpenAI continues to enhance its AI models and expand user access to advanced features.

• The company has been working on improving the ChatGPT 4o-mini model, aiming to enhance its capabilities and performance.
• OpenAI is gradually rolling out the Advanced Voice mode to a broader user base, indicating ongoing efforts to diversify and improve the ChatGPT experience.

Potential impact on users: While the projected price increases may seem substantial, their implementation is not immediate, and users may see additional value in the service over time.

• The price hikes are expected to be gradual, with the first increase not anticipated until late 2024.
• New features and improved AI models may accompany these price increases, potentially justifying the higher cost for subscribers.
• Users will have time to evaluate the value proposition of ChatGPT Plus as changes are implemented over the coming years.

Market implications and competitive landscape: The planned price increases for ChatGPT Plus could have broader implications for the AI industry and competing services.

• As a leader in the AI chatbot space, OpenAI’s pricing decisions may influence other companies’ strategies and set new benchmarks for premium AI services.
• Competitors may see an opportunity to attract price-sensitive users by offering more affordable alternatives to ChatGPT Plus.
• The price hikes could also spur innovation in the industry, as companies seek to justify higher costs with more advanced features and capabilities.

Balancing act for OpenAI: The company faces the challenge of maintaining its competitive edge while addressing its financial needs and continuing to invest in AI development.

• The projected price increases reflect OpenAI’s need to improve its financial position and support ongoing research and development efforts.
• However, the company must carefully balance these financial considerations with the risk of pricing out users or driving them to competing services.
• OpenAI’s ability to deliver compelling new features and improvements will be crucial in retaining subscribers and attracting new ones, even as prices rise.