OpenAI closes Google deal, but ramps up price war with Gemini ...
The partnership between Microsoft and OpenAI has come to an end. Now, OpenAI is in need of AI computing power, leading them to collaborate with Google Cloud. Not only is OpenAI working with Google Cloud, but they are also reducing their own prices and introducing new models to surpass Google’s Gemini team.
Google Cloud Deal and Independence from Microsoft
The news of OpenAI's collaboration with Google Cloud has recently surfaced, indicating a shift towards becoming cloud-independent from their previous partner, Microsoft. One of their significant projects, Stargate, aims to establish a nationwide AI infrastructure in the United States, signaling a new direction for CEO Sam Altman’s organization.
Competition in AI Infrastructure
While Google has made strides in Large Language Models (LLMs) despite initial challenges, companies like Anthropic, Meta, Mistral, DeepSeek, and OpenAI are actively developing their AI infrastructure. Google's advancements with their Gemini models have positioned them as a strong player in the field.
Price Reductions and New Models
To keep up with Google's progress, OpenAI has implemented substantial price cuts and introduced new models. The API cost for the o3 model has been slashed by 80%, making it a more cost-effective option. Moreover, OpenAI has launched the o3-pro model as a replacement for ChatGPT Pro and Team users, priced at $20 per million input tokens and $80 per million output tokens.
Future Outlook and Competition
As Google continues to innovate internally, their collaboration with OpenAI is forecasted to bring financial benefits, particularly to their Cloud division. Analysts predict potential competition from ChatGPT as an alternative search engine in the long run, with Google exploring various AI initiatives like AI Mode through Google Gemini.
References:
1. OpenAI and Google sign deal for cloud computing capacity
2. chatgpt / Gemini / Google / Google Cloud / OpenAI
