OpenAI has had a rough year so far. It’s only been a week since 2025 began. Here’s what went wrong for the influential company over the past seven days. Also, a look at potential frustrations and challenges that it may face as it enters the new year.
Sam Altman’s Sister Sues Him
Annie Altman has filed a lawsuit against the CEO of the company, Sam Altman. She accuses him of sexual abuse. The lawsuit, filed on Monday in U.S. District Court for the Eastern District of Missouri, claims that Altman abused her when she was 3 years old and he 12 years old. The lawsuit claims that Annie suffered “severe mental anguish and depression” as a result of the sexual assaults when she was three years old and he was 12.
The allegations of abuse circulated on the internet for more than a year. They first came to the attention of the public after Altman was controversially removed from OpenAI. (He would later be reinstated.) The litigation has clearly pushed the allegations to a wider audience. If the case were to go to trial, this could be disastrous for OpenAI in terms of PR.
Altman’s Family released a statement on Wednesday in response to Annie’s lawsuit. The statement reads: “All of these allegations are utterly false.” This situation causes our entire family immense pain. It is particularly heartbreaking when she refuses conventional treatment and lashes at family members who genuinely try to help. The statement, shared by Altman on X further characterizes Annie, as mentally unwell, and financially motivated. The statement states that the family has supported Annie financially for years, but she “continues” to demand money from them.
A former employee’s relatives accuse the company of murder
In recent weeks the company has been the subject of conspiracy theories alleging that it murdered a former worker. Suchir Balaji’s death on November 26th sparked immediate suspicion despite the fact the San Francisco Medical Examiner’s Office ruled it a suicide. In the months leading up to his death, Balaji was a corporate whistleblower who claimed that the company had violated U.S. copyright laws. Balaji wrote an essay online a few weeks prior to his death in which he claimed that the company’s content creation approach did not meet the U.S. definition for “fair use.”
The police have stated that there is no evidence of foul play in Balaji’s death. However, his family believes that OpenAI was responsible for his murder and has asked the FBI to investigate. In an interview with The San Francisco Standard the Balaji family revealed that they “believed that their son was killed at the behest OpenAI and other AI companies.” Poornima, his mother, said that his testimony would have a major impact on a $100 billion dollar industry. It could be a group, a company, or a complete nexus. The autopsy report of the medical examiner has not been made public yet.
The Cybertruck bomber is alleged to have used ChatGPT as a planning tool.
It was also recently discovered that the man who blew himself in a Cybertruck near Trump Tower plotted the attack using ChatGPT. Las Vegas police revealed details at a press briefing on Tuesday. Las Vegas Sheriff Kevin McMahill said, “This is the very first incident I am aware of in which ChatGPT was used to help a person build a specific device on U.S. land.” It’s a worrying moment. OpenAI probably won’t want to use that in their ad copy.
Political headwinds
OpenAI is not only facing a series of bizarre and splashy scandals but also the political realities of Trump’s second term. Elon Musk, former founder and investor of the company, is now its worst enemy. He helped Trump win the election and has unprecedented access to federal government levers. Musk, who has been dubbed America’s “co president,” is also waging an ongoing legal battle against OpenAI. OpenAI has called it “frivolous,” but the fight shows no signs of stopping.
Musk’s lawsuit from last year claims that the company has abandoned its original mission to pursue a for-profit model. (OpenAI announced recently that it would ditch its original, strange structure in order to pursue a traditional business strategy.) When we last checked in on this litigation effort in November, Musk had expanded his lawsuit to include other entities that were close to OpenAI including its backer Microsoft.
Musk can use his media platform X to harm the reputation of the company, even while he is fighting the legal battle. Musk and his affiliates are openly spreading damaging conspiracies about OpenAI’s recent controversies. The Standard reports that Musk and those close to him spread conspiracy theories about the death of coder Suchir Balaji after his death. “When Ramarao, Balaji’s mother, tweeted about hiring a private investigator, Musk replied, “This doesn’t appear to be a suicide.”
OpenAI’s economics is fraught with danger
OpenAI’s greatest dilemma may not be political, but economic. The massive amounts of cash that are being used to prop the company up have many people wondering: Is OpenAI’s business model sustainable? The company reported that it lost $5 billion last year while generating substantially less revenue. OpenAI claims that its revenue will reach $11 billion this year, and continue to grow exponentially over the next few years.
OpenAI has even claimed that it will have $100 billion in revenue by 2029, just four years away. OpenAI’s growth has been phenomenal (its revenue increased 1,700% in a single year, according to the New York Times), but skeptics see the projections as a PR fantasy designed to attract perpetual cash infusions in the venture capital world. Blogger Ed Zitron has called OpenAI an “unprofitable, directionless, and unsustainable blob” and noted that the company’s estimates of its future revenue are “fucking absurd.” Zitron is firmly in the doubter camp.
The company claims that it expects $11.6 billion in revenue by 2025, and $100 billion within 2029. This is such a ludicrous statement that I’m surprised that it hasn’t been deemed a financial crime. Microsoft makes approximately $250 billion per year, Google around $300 billion, and Apple around $400 billion. OpenAI spends $2.35 for every $1 it makes.
Zitron notes that OpenAI appears to make the majority of its revenue through subscriptions to ChatGPT. However, this doesn’t appear to be enough to cover its ongoing losses. OpenAI makes money from licensing its algorithmic models to be used in software products. It doesn’t really matter if revenue increases, if service costs remain high. OpenAI could certainly raise prices, but it has competitors who have deep pockets and meet similar benchmarks.
OpenAI’s work is far from over. The company is facing powerful opponents, ongoing lawsuits and looming scandals which could prove disastrous for its brand. It needs to prove the media hype it has enjoyed over the past few years can translate into hard dollars and cents. It’s not clear, at least at this point, how the company will do that.
