• 5 hours

    That icon image reminded me of an old King Crimson album I used to own.

  • 11 hours

    That money would have been more useful literally being burnt for warmth.

  • There was an article yesterday that if you sign up for the most expensive OpenAI plan and actually use it fully, OpenAI loses $14k a year on you.

    This reminds me of the early Internet days. I ran an ISP. Like everyone else we offered “unlimited” service. But if everyone actually used unlimited we would have been bankrupted because it would tie up a phone line (channel of a pri) and modem on the portmaster. Regular users only used 1/10th of “unlimited”.

    • 11 hours

      I think that number is massively inflated. $1k loss is much more reasonable value

      • Where did you get $1k? Semianalysis’s report is paywalled but seems thorough.

        • Rough estimation. Reasoning + answer is ~1k tokens. API price for Chat GPT 5.5 is $30 per 1mil of output tokens, $5 per mil, for new input tokens and $0.50 for cached tokens. They allow 3k reasoning prompts per week.

          Quick math 12000prompts x1000tokens=12mil tokens per month which will be 12x30= $360 add all long context costs at and you can double or triple that cost.

          If you consider non reasoning prompting cost can be scaled to infinity since as far I’m aware subscription offers unlimited access for that. But they have anti abuse clause in the agreement, so I doubt you’ll get to anywhere close to $14k cost

          • They allow 3k reasoning prompts per week.

            It’s their unlimited plan that loses them money. Where did you get 3,000/week? Their message cap is hidden and users complain they don’t know how much of their “unlimited” is used up before being cut off.

            • They forgot to update polish translated help site. What a clusterfuck.

              https://help.openai.com/pl-pl/articles/11909943-gpt-55-in-chatgpt

              Użycie Thinking

              Jeśli korzystasz z planu Plus lub Business, możesz ręcznie wybrać GPT-5.5 Thinking w selektorze modeli z limitem użycia do 3000 wiadomości tygodniowo. Po osiągnięciu tygodniowego limitu zobaczysz wyskakujące powiadomienie, a GPT-5.5 Thinking nie będzie już można wybrać z menu. Jeśli korzystasz z planu Go, możesz wybrać Thinking z menu narzędzi, klikając ikonę + w polu wpisywania czatu. Użytkownicy Go mogą wysłać do 10 wiadomości co 5 godzin po włączeniu Thinking. Automatyczne przełączanie z GPT-5.5 Instant na GPT-5.5 Thinking nie wlicza się do tego tygodniowego limitu, a ChatGPT może nadal przełączyć się na GPT-5.5 Thinking nawet po jego osiągnięciu.

              This paragraph doesn’t exist in eng version

              Right now it says Plus and Business plans are limited to 3000 messages per week for thinking, and that automatic switch to thinking doesn’t count towards limit.

              Thy updated yesterday apparently so who knows what was written a week ago… So I don’t know, If I misread business for pro, or did they update policy again and again.

              Edit: Correction eng exists but says

              If you are on Plus or Business, you can manually select GPT-5.5 Thinking from the model picker. If you are on a Go plan, select + in the chat entry box, then select Thinking. Go users can send up to 10 messages every 5 hours after enabling Thinking. Automatic switching from GPT-5.5 Instant to GPT-5.5 Thinking does not count toward manual Thinking usage limits.

              So they have some unspecified limit?

    • Isn’t that basically every ‘all you can eat’ model though? 20% of people will fully max their usage, causing a loss, but the 80% of users will use far less than the purchase price, netting $$$ for the company. When that balance shifts, most places just put more limits to that ‘all you can eat’ or raise prices. Sure, I have unlimited internet, but it’s difficult to symmetrically max out my 5gbit connection to get that full ‘cost’ each month.

      As long as OpenAI has a health amount of money in the bank ($50 billion it seems), they have a long time to burn money, and then you just keep getting people to invest. Pretty sure that’s been the model of every tech company for a long time. I think Uber took almost 15 years to be profitable, and had almost $50 billion invested. For a company that owns essentially zero cars, pretty wild.

    • 1 day

      I take your ISP didn’t have a free tier that also lost money, though, unlike these companies with apparently infinite money to give away

  • What does a CFO actually do in these situations, how do they balance a book that is creating its own black hole?

    • 1 day

      That’s quite easy, the books are balanced, there are just more debits than credits. “Balancing the books” doesn’t mean that the net result is zero, it means that all the money going in and going out is accounted for.

      OpenAI can keep bleeding money as long as there are fools willing to fund it in exchange for the illusion of future profits.

      • You can’t have balanced books where there are more debits than credits. That would be out of balance.

        Balanced means debits = credits.

        • 1 day

          I’m not an accountant, but you can certainly balance books while showing a loss. Double-entry bookkeeping simply means that every transaction has two parts, and “balancing” simply means that all the transactions cancel out properly.

          I joke with my accountant friends that their entire job is counting to zero.

          • A loss is not an imbalance of debits and credits, but how much of those debits end up in expenses and the credits end up in revenue.

            DR Expense $1,000
            CR Cash $1,000
            

            With no other activity in a period, that is a $1,000 loss funded by cash.

            DR Expense $1,000
            CR Loan $1,000
            

            Is a loss funded by borrowings.

            DR Sales Discounts $1,000
            CR Sales Revenue $1,000
            

            Is 0 profit/expense as the sale was marked down to 0 (assuming no cost of sales).

            • 1 day

              Exactly. My terminology might not be correct, but my point is that their books can be perfectly balanced, and they can also be losing a shit-ton of money, as long as investors keep shoveling money in.

              • Yeah the terminology

                the books are balanced, there are just more debits than credits

                is the opposite of everything discussed above.

    • OpenAI still has $50 billion, about half of that in cash, because they keep fund raising. The game is keep extending the runway until early investors can cash out and leave someone else holding the bag.