OpenAI's network effects strategy

Since the release of ChatGPT, OpenAI has faced competition from many new closed- and open-source models.

To maintain its dominant share in the growing market for LLMs, OpenAI has been using different tactics. These include innovative features and offered free access to less advanced models, broadening its user base.

The company's latest strategy, revealed at the recent DevDay conference, focuses on network effects, akin to the Apple App Store and Google Play Store.

The company’s GPT Store and a revenue-sharing scheme can give it the edge it needs to create moats around its LLM business and protect it against competitors. For better or worse, this aggressive market capture will have important implications for the future of LLM applications and market.

Read the article on TechTalks.

For more on AI business:

• Apple’s AI strategy

• Revisiting Google’s AI moat after I/O 2023

• How Microsoft’s partnership with OpenAI put it ahead in the AI race

• Best practices for deploying AI within large organizations

Recommendations:

• My go-to platform for working with ChatGPT, GPT-4, and Claude is ForeFront.ai, which has a super-flexible pricing plan and plenty of good features for writing and coding.