As the Information first reported, Sam Altman issued a “code red” to OpenAI employees. The memo acknowledged a serious threat posed by Google’s latest Gemini 3. Not too long ago, the roles were reversed: Google called a “code red” in 2023 with the release of ChatGPT.
The Wall Street Journal also reported: “Gemini’s user base has been climbing since the August release of an image generator, Nano Banana, and Google said monthly active users grew from 450 million in July to 650 million in October. OpenAI is also facing pressure from Anthropic, which is becoming popular among business customers.” Moreover, “Altman said OpenAI would be pushing back work on other initiatives, such as advertising, AI agents for health and shopping, and a personal assistant called Pulse. He encouraged temporary team transfers and said the company would have a daily call for those responsible for improving ChatGPT.”
The business competition OpenAI now faces comes at a precarious time when OpenAI is facing mounting risk of copyright liability. Recent losses on motions before the court in New York are piling up:
Plus, OpenAI was just hit with another copyright lawsuit. This one seeking $10 billion in damages.
Even ChatGPT assesses OpenAI’s risk of liability as significant:
The last valuation of OpenAI was $500 billion. Given how many copyright lawsuits OpenAI faces, including proposed class actions of book authors and the New York Times’ and other newspapers’ lawsuits, OpenAI will likely need an infusion of cash to withstand — and post a bond just to appeal — any sizable damages award in the event it loses the copyright lawsuits in the trial court.