For the first time since its launch in November, the AI chatbot ChatGPT experienced a decline in website visits, suggesting a potential decrease in consumer interest towards AI chatbots and image-generators. According to SimilarWeb, global desktop and mobile traffic to the ChatGPT website witnessed a decline of 9.7% in June compared to May, while unique visitors to the website dropped by 5.7%. Additionally, the data reveals an 8.5% decrease in the amount of time visitors spent on the website.

But why? From being a general purpose chatbot to becoming a specialised platform, ChatGPT has come a long way from where it all started. Thanks to its recent ChatGPT Plugins and Code Interpreter upgrades, the chatbot is slowly but surely moving away from general purpose use cases, as users are now realising its true potential, moving towards subscription based models (ChatGPT Plus – powered by both GPT-3.5 and GPT-4), alongside integration of ChatGPT API. 

Recently, OpenAI announced its API access to more customisable versions of its software to other technology companies and corporate enterprises. Incidenly, the traffic to the platform.openai.com developer’s website was up 3.1% from May to June.

However, speculations are brewing from all corners as to why ChatGPT is facing these circumstances. Some experts argue that the newness of generative tools might be wearing off. While the Washington Post claims that the reduced usage of ChatGPT could be because of the vacation time off taken by school and college goers. One of the other speculations is AI hallucinations, where the chatbot generates inaccurate or unsatisfactory responses. 

When you do the maths, a paid subscription to ChatGPT Plus provides users access to a better experience i.e. ChatGPT Plus (based on GPT-4) and they are migrating to the paid version to utilise the tool to its full potential. In other words, free users have realised that the full potential of ChatGPT is only available through GPT-4. Ergo, the decline is possibly only the free users. 

It also has to be noted that OpenAI has not made any official announcement about the dip in users on ChatGPT yet, which opens doors for more speculations. But the real reason for the decline in website traffic could be due to paid subscription ChatGPT Plus and API availability. 

The same was witnessed in the case of text-to-image platform Midjourney, which also saw a dip in its users after it culled its free service, and transitioned completely to paid subscription plans. 

However, the drop in users in ChatGPT happens to be common between the free and the paid versions, as both are accessed on the same website. On the other hand, Midjourney has entirely stopped the free version. 

Is ChatGPT Next? 

While the dip in users continues to grow, the real question one needs to ask is how long before the free ChatGPT (based on GPT-3.5) service ends. “We love our free users and will continue to offer free access to ChatGPT. By offering this subscription pricing, we will be able to help support free access availability to as many people as possible,” the company said in its blog post. 

Ironically, the ChatGPT subscribers get GPT-4, while free users get an older version (GPT-3.5). The sustainability of that as a business model is questionable, given that people can get GPT-4 for free as part of Bing. Minus, ChatGPT Plugins and Code Interpreter. 

With ChatGPT Plus, OpenAI might be looking for conversions—– from free to paid users. And it is already happening, and decline in users is an early sign of that conversion. 

Hopefully, this may also help reduce the operational and upkeep costs of ChatGPT which Sam Altman, OpenAI’s CEO, has described as “eye-watering.”

Competition Galores 

Recently, San-Francisco-based AI lab Anthropic has announced Claude 2, a new ChatGPT rival open to the public in the US and the UK. One of the chatbot’s beta testers, Ethan Mollick, an Associate Professor at the Wharton School of the University said in a LinkedIn post, it has two big advantages over the other models: it is very good at handling documents (especially PDFs, which GPT struggles with) and shows a very sophisticated “understanding” of documents. Furthermore, it continues to be the most “pleasant” AI personality.

At the same with alternatives like Bard and Pi, it’s not going to be easy for free ChatGPT (based on GPT 3.5) to retain the users unless it reinvents itself and comes up with new features for them as well. This includes giving ChatGPT Plugins and ChatGPT Interpreter access with limited prompts, etc, which would in turn increase users as well conversions. 

All is not lost as this puts OpenAI in a slightly advantageous position. While the paid subscribers are growing, the slowdown in user engagement on the free version could mean well for the company. This builds an ecosystem of quality customers, and users look for more specialised use cases.