During the months following OpenAI’s announcement of its blockbuster AI chatbot ChatGPT just over three years ago, Google CEO Sundar Pichai pulled the fire alarm.
The search giant’s management issued a “code red” over what Pichai saw as an imminent disruption to its core business — a warranted level of caution, in retrospect, considering ChatGPT’s meteoric rise in popularity and influence.
The all-out brawl that followed in the subsequent years, with AI companies trying to outdo each other with their own offerings as investors threw tens of billions of dollars at the tech, has shifted the dynamics considerably.
And now, the tables have officially turned: OpenAI CEO Sam Altman has declared his own “code red” in a memo to employees this week, as the Wall Street Journal reports, urging staffers to improve the quality of the company’s blockbuster chatbot, even at the cost of delaying other projects.
It’s the clearest sign yet that Altman and OpenAI are feeling an immense level of pressure in light of steep competition that has done a lot of catching up since ChatGPT was released to the public in late 2022.
Google, in particular, threw down the gauntlet with its latest AI model, Gemini 3, which scored higher on benchmarks than ChatGPT last month. The search giant’s monthly active AI users have grown considerably as well, ballooning from 450 million to 650 million between July and October. That’s a stone’s throw from the 800 million or so weekly users ChatGPT had as of September.
To once again leave its competition behind, OpenAI has committed to spending well over $1 trillion on data center buildouts to support new users and its latest AI models. That’s despite burning through billions of dollars each quarter.
Google, though, has a major financial advantage by already being profitable. It can afford to spend aggressively on data centers, at least for the time being. That’s besides Google Search having been the de facto search engine on the internet for decades, giving it access to a vast number of existing users who could be swayed by its AI offerings.
Altman claimed in the memo that the company has an ace up its sleeve in the form of an even more powerful reasoning model that’s set to be released as early as next week, according to the WSJ, likely a direct response to Google’s Gemini 3.
He’s looking to better the day-to-day experience of ChatGPT, while also speeding it up and making it more reliable. The goal is to pour OpenAI’s resources into making its AI chatbot feel “even more intuitive and personal,” according to a recent tweet by ChatGPT head Nick Turley.
Meanwhile, other projects, like ads or AI shopping agents, have reportedly been moved to the back burner.
OpenAI has come under fire from ChatGPT’s user base following the release of its GPT-5 large language model in August, facing complaints of the new…
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