OpenAI CEO predicts 10x annual reduction in AI costs
OpenAI CEO Sam Altman has projected that the cost of running artificial intelligence will decrease by approximately ten times every year.
In a blog post about AI economics on February 9, Altman highlighted that this reduction in AI costs could significantly lower the price of many products.
He explained that as the cost of AI decreases, the increased use of AI will drive down the prices of goods, making them more accessible to consumers.
Altman pointed to a dramatic example: the cost of using the GPT-4 model, developed by OpenAI, has dropped by 150 times from early 2023 to mid-2024.
This rate of decrease is much faster than Moore’s Law, which observes that the number of transistors in an integrated circuit doubles approximately every two years, leading to enhanced efficiency and lower costs for electronics.
Altman likened AI’s economic potential to the transistor, which revolutionised industries by providing greater processing power at lower costs.
He believes that AI could have a similar impact on various sectors, with far-reaching effects on the global economy.
While Altman predicts that the prices of most goods will fall due to cheaper AI, he also notes that luxury items and limited resources, such as land, may become even more expensive.
Altman also discussed ideas for democratising AI access globally, such as providing "compute budgets" to allow people worldwide to use AI at scale.
He envisions a future where everyone has access to vast intellectual capacity, with the goal of offering individuals the equivalent of global expertise by 2035.
The discussion of AI costs gained attention in January, when the launch of the low-cost DeepSeek AI model by a Chinese developer disrupted the market, causing major losses for US companies like Nvidia.
Chinese firms, including automakers and tech companies, have begun integrating DeepSeek’s capabilities into their products.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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