Why OpenAI's Enterprise Pivot Makes Sense | Sharp Tech with Ben Thompson

So, a couple things. Number one, the OpenAI rumor, all hands meeting, whatever, didn't say they're exiting the consumer business, right? We know they have side quests that can get rid of like Sora, for example, like the Sora app. We spent a lot of time on that. We've been chastised I think over for it was a fun couple of weeks but it didn't ultimately matter to the bottom line. And there's some other number of other things and from what I understand, another thing to potentially point to is the hardware question which Sam said no we're not getting out of it and I'm pretty sure they're not getting out of that. I think they're he said we are not shutting it down quite the opposite I think you will love what the team is building. Yeah, so that's probably the tell. Are we giving up the consumer market? And by all accounts I don't think they are. And so number one, let's not overread what they said, right? I think some of the reactions, not just Adrian, some of the reactions online were a bit too dramatic. Like I didn't come away thinking OpenAI is just going to punt on the consumer space altogether. It makes sense as far as focus going forward. There's a massive opportunity in the enterprise space right now on the subscription basis. It makes sense to channel more resources in that direction particularly given how performant Codex has been which we discussed last week like all is threatening to basically just win the whole thing right that's what's really happening here is that blowing up in the enterprise they have been for a while that it looks their growth over the last two years looks like an exponential curve in that like they're growing they're growing they're growing and then holy crap they're growing you know like from 14 billion run rate in January 19 billion like now something crazy like that like just dramatic sort of ramp up and the issue is enterprises do pay for productivity and if AI is indeed a massive productivity enhancer such a massive productivity enhancer that it not only makes employees more productive but potentially replaces employees the size of that market is probably larger than Adrian is giving it credit for and that may be a sufficient flywheel to then go into the consumer market and there is an analogy for this which is Microsoft in the 80s and 90s. Microsoft was an enterprise company. They got the Windows flywheel going in enterprise and then basically won the consumer market for free. And Microsoft itself forgot this lesson, right? When they were trying to do like the Zoom and like they were never a consumer company. They won the consumer company by virtue of dominating the enterprise and then they sort of got consumer for free and they still have hangover from that. Like why is Microsoft still dominant in terms of gaming? That's downstream from winning enterprise in the 80s and 90s, right? They've done investments there but they had critical mass at the moment when gaming blew up was a big thing. Everything's built around Windows. Their DirectX thing all just in all the components and the hardware and all these bits and pieces like so they still maintain consumer presence but they've always been an enterprise company that sort of got that for free whereas Apple was a consumer company that was in the wilderness. It almost went bankrupt because they were trying to sell to consumers at a time when consumers weren't willing to pay for what they were charging for the first 20 or 30. Well, they're charging a premium and just like there weren't that many people in the consumer space that cared enough that cared to get a computer and cared enough to buy a differentiated computer. Just easier to get what you get at work, which by the way was much cheaper because you had this flywheel going. And the computers were much more inexpensive and more performant and like just everything about the Apple thing was worse. So, just to push back on Adrian, we do have an example in tech history of the more important flywheel being enterprise that lets you win consumer and when we haven't fully fleshed out the business model, we know enterprise will just pay. They'll pay for what they're getting and that's super powerful. So, and we could lose it if we don't seize the opportunity over the next year or two here, right?