[huac]

I don't have any access to their financials, so this is speculative, but while they do 'give away' GPT-3.5-turbo in the free ChatGPT, the rest of the business is likely extremely profitable. If you want to estimate cost of serving those free requests, consider how much it costs to do that via API. A 10 message conversation, where ChatGPT outputs 200 tokens each time, is $0.002, or two-tenths of a cent. I believe their API usage to still be positive margin for them. (Of course, now consider how much markup there is in ChatGPT pro!!)

There is a difference between pricing aggressively and pricing at a loss. Their pricing for gpt-3.5-turbo now matches leading public providers for Llama-70B ($1/million tokens). Rumors are that 3.5-turbo is actually a 20B model, but even let's assume that it is larger than 70B: OpenAI can still price more aggressively than Llama-70B providers because they have better throughput and utilization of the same hardware.