Editor\u2019s note: This article has been updated to correct the spelling of Mark Cuban\u2019s name.<\/p>\n
OpenAI’s business strategy doesn\u2019t impress billionaire Mark Cuban.<\/p>\n
“They’re [throwing] away the money at scale,\u201d Cuban said.<\/p>\n
In an appearance on the Big Technology Podcast, the former \u201cShark Tank\u201d star criticized OpenAI’s fundraising efforts. He compared the ChatGPT maker to Apple, stating that they have “spent next to nothing” and yet they have built a foundation where you can just “plug and play into their devices.”<\/p>\n
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The entrepreneur added that he is skeptical of the large spending projections for data centers. He argued that computing power is advancing so quickly, becoming faster and cheaper, that many of today’s eye-catching investment projections are unlikely to materialize.<\/p>\n
The numbers thrown out there “aren’t going to come to fruition,\u201d Cuban said. \u201cIt’s not going to happen.”<\/p>\n
Those who have gone all in on AI are \u201cspending more cash than they have available,\u201d Cuban said. Whether large AI models (like those behind ChatGPT or Gemini) will be profitable remains to be seen, he adds.<\/p>\n
Specifically, he questioned whether the industry will end up like streaming, with a few winners and many struggling, or if it will consolidate into one dominant company.<\/p>\n
OpenAI, which is reportedly preparing for a public listing, boasts a $852 billion valuation.\u00a0But it has reportedly failed to meet its revenue and new-user targets. As a result, observers wonder whether it can sustain high data center costs.<\/p>\n