Short answer: Sam Nadler says Altman declared a code red to focus on ChatGPT in response to Google's Gemini. Amar Goel says OpenAI went too broad too fast, leaving room for Anthropic in coding, while Google has distribution and an ad model.
Watch this answer from Episode 23 (starts at 17:01) · Episode 23 notes and transcript
From Episode 23: OpenAI Code Red? The New AI Reviewer Changing Everything, starting at 17:01.
Sam Nadler [17:01]: Yeah. Okay. So, news story number one is Code at OpenAI. Code Red at OpenAI. OpenAI has or Sam Altman has declared a Code Red internally. This leaked, I think, within the last forty eight hours, pulling back all other initiatives to focus solely on the ChatGPT product. Obviously, I think it's in response to Google and Gemini's, significant advancements over the past several weeks or months. Would love to hear your thoughts on this competitive pressure from Google to OpenAI.
Amar Goel [17:39]: For a long time, I've kind of felt like OpenAI went too broad too fast. Know? They kind of have gotten into so many different areas, voice models, video models, image models. There's ChatGPT, there's coding. And I feel like, they got the consumer business, the API business. Now look, they are the biggest player in the space, 20,000,000,000 in revenue, annualized run rate revenue. So, I mean, I think I could I can understand how they got to this situation, but it felt a little bit like they were going if this space is gonna be so big, you're gonna need to, like, really be good at a few things. And I think by kind of going after everything, they've left a lot of room around their flanks, you know. So, Anthropic has really kind of excelled in the coding use case. Anthropic is also really good at writing. Now Gemini, you know, I saw like Marc Benioff over the weekend said he thought Gemini three was significantly better than ChatGPT, and he switched over to that after years of using ChatGPT. I mean, I personally haven't felt like Gemini three is like so groundbreaking per se. I know on the benchmarks it's done really well, but I do think it's quite a good model. Like, I'm able to I'm using it now whereas before I was just kinda defaulting to ChatGPT and Claude. But now I'm like, oh, Gemini sometimes I like its answers better and whatever.
Amar Goel [19:12]: But I still think it's like a really, the product is not nearly as rich, can't make a PDF or, things like that. But they have so much distribution. Right? Like, you they've they've got the button in Gemini, the Gemini button sorry, in Chrome. They've got AI mode now. Right? And so it's kind of front and center, in your face. And they also have an ad model that allows them to not have to charge consumers. Right? They like can make money from the ads whereas, ChatGPT, is I mean, a lot of the revenue is coming from their ad model. And I mean, there's no Internet product that has achieved mass scale, like, on the order of, a billion users or more by having a paid model. Know? There's just not enough people that are willing to pay money. So, I think that, it probably is a bit of a code red. I mean, I don't think it's, like, their, roadkill or anything like that, but I think they do need to probably focus in a little bit.
Amar Goel [20:13]: And, actually, it's funny that there's a sorry. It's a long comment. But, the Stratechery blog kinda mentioned this week that they think OpenAI needs to get an ad model. And I thought it was so interesting that, I think these articles have been saying that they put their ad products on hold, to focus in on ChatGPT and I think go more into the making the product better, which is probably a good start, but they're still sticking to the paid model as their primary mechanism.
