According to media reports, OpenAI plans to unveil a new artificial-intelligence reasoning model this week that will reportedly surpass Google’s latest, most advanced family of AI models, Gemini 3.
online technical magazine decoder Citing industry insiders, it is claimed that the launch is aimed at matching Google’s recent advances in cutting-edge logic, deep multimodal understanding of text, images and video, as well as Gemini 3’s powerful coding capabilities.
Google’s parent company Alphabet introduced Gemini 3 in November, whose benchmark results outperformed OpenAI’s flagship model ChatGPT in key categories.
The result shocked OpenAI, which has been seen as the front runner in the industry since the introduction of ChatGPT in 2022, which changed public awareness of generative AI and stymied competitors for some time.
Now, OpenAI’s lead is no longer assured.
A ‘Code Red’ moment for OpenAI
According to a memo cited by a US business newspaper, the reaction inside OpenAI has been immediate, with CEO Sam Altman reportedly announcing a “code red” in an internal message, instructing teams to focus on improving the quality of ChatGPT and delaying other products as a result. Wall Street Journal.
“We have reached a point where it’s not just about having the best model, but also about access to computing power and the ability to turn that technology into revenue,” Adrian Cox, an analyst at Deutsche Bank Research, told DW.
OpenAI gained an early lead thanks to the periods in which its models outperformed any alternatives, he said, but competitors are rapidly closing the gap — and many are backed by companies with vast distribution networks and cloud infrastructure.
“Models like Gemini benefit from being tightly integrated into products that already have access to huge data-center capacity as well as huge online audiences,” Cox said.
According to Altman, ChatGPT attracts more than 800 million weekly users. But Alphabet could position its most profitable product, Gemini, directly in Google Search.
Gemini app already reaches more than 650 million monthly users, writes Alphabet CEO Sundar Pichai Google’s blogSaying that more than 70% of its cloud customers are using AI tools.
,[Thirteen] “Millions of developers have built with our generic model, and this is just a sliver of the impact we are seeing,” he wrote on November 18.
OpenAI still not making profit
While Google generates revenue across a wide portfolio of operations, OpenAI must directly monetize its AI models. It currently relies on premium ChatGPT subscription and enterprise licensing. Microsoft, a major shareholder, also pays to embed OpenAI technology in its products.
Nevertheless, Altman acknowledged that the company is still not profitable.
OpenAI does not disclose financial details. But according to Cox, investors were told over the summer that 2030 could be the first profitable year for OpenAI.
HSBC analysts have a weak outlook, according to the British financial newspaper. financial TimesRecently reported. The bank projects revenues could reach $213 billion (€182 billion) by 2030 – but are still likely to lose more than $70 billion due to rising infrastructure costs.
Massive AI investment needed
Training and running cutting-edge AI systems requires huge outlays for data-center capacity.
Google plans to invest up to $93 billion in AI this year alone, with “significant growth” set for years to come. Its parent company Alphabet’s fourth-quarter revenue exceeded $100 billion, boosted primarily by advertising and rising cloud demand.
Google also has a hardware advantage, as its proprietary AI chips support model training inside company-owned data centers, thus avoiding the purchase of more expensive semiconductors from AI-chip market leader Nvidia.
Facebook’s parent company Meta has reportedly expressed interest in using Google’s processors for its own AI infrastructure.
Given those strengths, Adrian Cox sees it “very likely” that Google will have the leading model for at least the next year — not OpenAI. OpenAI’s priority, he said, is to identify a business model capable of financing a user base that could soon reach one billion people per week.
“It is uncertain how this will work in practice. Subscription revenue alone may not be enough to cover costs,” he said, adding that the company is exploring other revenue streams.
Competition goes beyond Big Tech
Meanwhile, the race for AI leadership is no longer limited to just two Silicon Valley contenders. “Competition has intensified since 2022. We now see strong challengers from established companies like Google as well as best-in-class models like Anthropic,” Cox said.
Open-source models from the US, China and Europe – including European startup Mistral – are also gaining popularity. These systems are smaller and cheaper than OpenAI’s offerings, designed for targeted applications rather than broad capability.
“Customers today have a very wide range of choices – from highly advanced models to lightweight, fast, cost-efficient open-source systems,” Cox said, adding that the upcoming ChatGPT-5 may be the most versatile model currently in development, but its complexity makes it “expensive to operate and less optimized for specific user groups.”
Additionally, China’s AI companies are also moving forward. In September, search engine provider Baidu unveiled its DeepSeek model, claiming performance comparable to ChatGPT-5 and Google’s Gemini 2.5 Pro.
Analysts say the country is once again leaning on aggressive pricing strategies to fend off competitors in overseas markets – a strategy previously used in solar, steel and electric vehicles.
Nvidia CEO Jensen Huang warned in November that China is “only nanoseconds behind the US in AI.”
Across the industry, Cox sees a different ecosystem forming, as the market is dividing between “small, customizable open-source models that are cheap to run, and larger, sophisticated proprietary models.”
Still, he doesn’t expect a win-win outcome. “More [artificial] The more intelligence becomes available, the more user applications will emerge.”
This article was originally written in German.