OpenAI is having a tough week – it could be the start of a tough year

We’re only a week away from 2025, but already OpenAI is having a rough year. Here’s a look at everything that’s gone wrong for the venerable company over the past seven days, and the potential disappointments and headwinds it faces heading into the new year.

Sam Altman’s sister is suing him

Annie Altman, sister of company CEO Sam Altman, sued the executive headaccused him of sexual abuse. The lawsuit, filed Monday in the U.S. District Court for the Eastern District of Missouri, alleges Altman’s sister molested him when he was 3 and he was 12. The lawsuit alleges that “as a direct and proximate result of the above acts of sexual violence,” Annie suffered “severe emotional distress, mental anguish and depression that is expected to continue into the future.” The lawsuit seeks more than $75,000 in damages, as well as a jury trial.

The allegations of abuse have been circulating on the internet for more than a year and won the first time main focus In the post-Altman days controversially overthrown From OpenAI (to be restored later). The case clearly brought the allegations to a wider audience. If it were to go to court, it could be disastrous for OpenAI in terms of PR.

Altman’s family issued a statement Reply to Annie’s claim on Wednesday. “All these claims are completely untrue,” the statement said. “This situation causes great pain to our whole family. “It’s especially gut-wrenching when he refuses conventional treatment and lash out at family members who are genuinely trying to help.” Altman’s statement on X describes Annie as more mentally challenged and financially motivated. The family reportedly supported her financially for years and she “kept asking them for more money.”

The family of the former employee accuses the company of murder

In recent weeks, the company has also been subject to conspiracy theories claiming it killed a former employee. Suchir Balaji’s death on November 26 was immediately suspicious, although the San Francisco Medical Examiner’s Office called the death a suicide. This is because a few months before his death, Balaji was acting as a corporate whistleblower. make claims said the company violated US copyright law. It was written by Balaji just a few weeks before his death online essay claimed to show that the company’s approach to content creation has not come down US definition of “fair use”.

While police said there was “no evidence of foul play” in Balaji’s case, his family claimed he was killed by OpenAI and demanded the FBI investigate his death. The Balaji family in an interview with The San Francisco Standard delivered it they “believed that their son was killed at the behest of OpenAI and other artificial intelligence companies. “This is a $100-billion industry that will be disrupted by his testimony,” said his mother, Poornima Ramarao. “It could be a group of people, a group of companies, a whole nexus.” The medical examiner’s autopsy has not yet been made public.

The Cybertruck bomber allegedly used ChatGPT to plan his attack

Most notably, the person who recently blew himself up in a Cybertruck outside Trump Tower was learned to have used ChatGPT to plan the attack. Las Vegas police recently released the details to reporters press conference on Tuesday. Las Vegas Sheriff Kevin McMahill said, “This is the first case that I am aware of in the United States where ChatGPT has been used to help an individual set up a specific device.” “This is a worrying point.” It’s not exactly something OpenAI wants to include in its ad copy (“Useful for planning terrorist attacks!” It just doesn’t have a great ring to it).

Political winds

Not only is OpenAI facing a series of weird, high-profile scandals, it’s also facing the political realities of a second Trump presidency. Elon Musk, the company’s former founder (and investor) became the worst enemynotably helped Trump win and now has unprecedented access to the levers of power of the federal government. Musk, who has been called the “co-president” of America, is also waging a legal war against OpenAI that, despite being called “serious” by OpenAI, shows no signs of going anywhere.

Musk’s lawsuit filed last year alleges the company betrayed its original mission in favor of a for-profit business model (OpenAI). announced recently would refuse him original, strange structure implementing a more traditional business strategy). When we checked into this lawsuit last November, it was Musk expanded his claim Other organizations close to OpenAI, including its backer Microsoft.

At the same time, while Musk is engaged in legal battles and can manipulate federal policy in a way that could hinder OpenAI, he can also use the soft power of media platform X to damage the company’s reputation. . Indeed, Musk and his affiliates have seized on some of OpenAI’s recent controversy by openly spreading malicious conspiracy theories. The Standard notes that after Suchir Balaji’s death, Musk and others close to him helped spread conspiracy theories about the coder’s death: “When Ramarao (Balaji’s mother) tweeted about hiring a private investigator, Musk replied: ‘It , it doesn’t seem like it. like suicide.”

The rich economy of OpenAI

OpenAI’s biggest dilemma may be less political than economic. That said, the large amount of money used to support the company has left many viewers wondering: Is OpenAI’s business model even sustainable? The company itself informed about this last year He lost 5 billion dollars while making significantly less money. OpenAI has claimed that its revenue will grow to around $11 billion by the end of this year and will continue to explode exponentially in the coming years.

Indeed, OpenAI has claimed that its revenue will reach $100 billion by 2029 – just four years from now. It’s true that OpenAI as a company has grown at an incredible rate (revenue grew 1,700 percent in one year, New York Times reported), although skeptics still see his predictions as PR fantasies designed to attract steady cash from venture capital true believers. Blogger Ed Zitron, who Referred to OpenAI “an unsustainable, unprofitable and directionless blob of a company”, noting that its own estimates of the company’s future profitability are “ridiculous”. Strongly expressing the doubt camp, Zitron writes:

…the company says it expects to earn $11.6 billion in 2025 and $100 billion by 2029. For some context, Microsoft makes about $250 billion a year, Google about $300 billion, and Apple about $400 billion a year. To be clear, OpenAI currently spends $2.35 to earn $1.

Zitron notes that OpenAI derives most of its revenue from subscriptions to ChatGPT, which does not make enough money to cover its ongoing losses. OpenAI also makes money by licensing the use of its algorithmic models for use in software products. As it is, if the cost of providing the service remains so high, it doesn’t matter whether their income increases or not. Sure, that might raise prices, but OpenAI has competitors with deep pockets and similar specs.

In short: OpenAI has a case for it. Faced with powerful competitors, ongoing litigation, and scandals that could be disastrous for the company’s brand, the company must prove that the media hype that carries it can actually translate into cold hard dollars and cents over the past few years. At least at this point, it’s not clear how to do that.