OpenAI to raise ChatGPT prices to $44 by 2029 as costs surge

OpenAI plans to increase the price of its ChatGPT Plus subscription from $20 to $22 per month by the end of 2024. Over the next five years, this price will rise even more, reaching $44 per month by 2029, according to internal documents shared by The New York Times.

This price increase is driven by OpenAI's need to manage its growing expenses. Despite earning $300 million in revenue each month as of August 2024, the company is expected to lose around $5 billion this year. The high costs are due to factors like employee salaries, office rent, and the expensive computing power required to run AI systems. According to reports, running ChatGPT alone costs the company $700,000 per day.

With about 10 million paying users, ChatGPT has been a major source of income for OpenAI, contributing $2.7 billion in revenue this year. However, to stay afloat, OpenAI is currently seeking additional funding, aiming to raise $7 billion from investors like Microsoft, Apple, and Nvidia. This would value the company at $150 billion.

While the price hikes might upset some users who already feel the $20 monthly fee is too high, OpenAI expects its revenue to continue growing, projecting $100 billion in annual sales by 2029.

OpenAI's increasing costs are partly due to its heavy reliance on Microsoft's cloud services to power its AI systems. As the company moves towards a for-profit business model, it faces pressure to balance its financial losses with user satisfaction and investor expectations.

The planned price increase will test whether users are willing to pay more for ChatGPT as OpenAI looks to secure its financial future.