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Despite what its name suggests, OpenAI isn’t the most transparent company when it comes to sharing details about its operations. However, this week they revealed some key information indicating that their ChatGPT for Enterprise subscription is doing well.
Since its launch in late August 2023, ChatGPT for Enterprise has secured over 260 business customers and has more than 150,000 unique users. This information was shared with Bloomberg during an extensive interview with OpenAI’s Chief Operating Officer, Brad Lightcap. While the pricing for ChatGPT for Enterprise isn’t publicly listed, a Reddit user mentioned a rate of $60 per seat, suggesting that with 150,000 users, the monthly revenue could be around $9 million, or $108 million annually. This is significant for a new product, though it’s only a fraction of OpenAI’s reported annual revenue of $1.6 billion.
OpenAI hasn’t disclosed a complete list of companies using ChatGPT for Enterprise, but in a blog post about the new ChatGPT Team tier, they mentioned clients like Block, Canva, Carlyle, The Estée Lauder Companies, PwC, and Zapier. This partial list, along with the user numbers, indicates a strong demand in the corporate sector for OpenAI’s AI-powered chatbots. This is noteworthy given that some businesses have hesitated to adopt AI due to concerns about inaccuracies, regulatory issues, privacy, and data security. OpenAI assures that for its Enterprise tier, “Enterprise data is excluded from training by default.”
Despite the availability of cheaper open-source alternatives like Meta’s Llama 2 and Mistral’s Mixtral, enterprise leaders seem willing to invest in OpenAI’s technology. These open-source options often require more effort to implement and maintain, and they typically lack robust support plans. OpenAI’s partnership with Microsoft likely adds to its appeal, as Microsoft is a trusted name in enterprise software and integrates several OpenAI products into its own offerings.
Given the choice between setting up a complex, labor-intensive open-source AI model and purchasing a ready-to-use, supported product from OpenAI, many enterprises find the latter option more appealing and worth the investment. This trend is similar to how consumers prefer paying for secure, convenient access to music and TV shows from services like Apple, Netflix, and Amazon, rather than opting for pirated alternatives.
OpenAI’s recent introduction of the ChatGPT Team tier, priced at $30 per user per month ($25 annually), is likely to attract even more enterprise customers. While some might argue that OpenAI should focus on the more expensive ChatGPT Enterprise tier, the new Team tier offers a more affordable option for small to medium-sized businesses, even if it comes with some limitations compared to the Enterprise tier.