In response to the success of competitor models like Gemini 3 and Claude Opus 4.5, OpenAI is reacting, with CEO Sam Altman now declaring a ‘code red’ for the company.
More specifically, that means Altman is now urging his staff to focus on improving the ChatGPT system, putting any extra projects to the side.
The Gemini effect
Google’s Gemini has been picking up steam quickly since it first launched. It took longer than OpenAI to get going, starting off as ‘Bard’ before switching to Gemini.
However, in the last year or so, Google has seemingly cracked the code, culminating in Gemini 3, an update that saw it skyrocket past OpenAI, creating an AI system that was dominating tests and impressing the experts of the AI field.
Gemini also has something that very few tech companies can match: the huge power of a company like Google behind it. Sure, companies including Apple, Samsung and Microsoft are all working on their own AI software, but none have done as well as Google has with Gemini.
Google makes smartphones, watches, laptops and more, as well as having the world’s most popular search engine and browser and the entire Google Suite, including Gmail and Drive.
This has allowed Google to not only create a truly powerful AI model but then implement it across half of the internet, putting it firmly in the public’s hands.
Business success
AI companies seem to be taking two different approaches. The likes of ChatGPT and Gemini are hoping to win over the masses, becoming the tools that we all use day to day.
Others, like Anthropic and Microsoft’s Copilot, are looking towards businesses instead. These companies have created AI products that focus on tasks like complicated coding, interacting with workflows and analyzing Excel documents.
These are functions that the likes of Gemini and ChatGPT can also do, but they aren’t marketed that way. Anthropic, with its latest update left any fancy bells and whistles behind, and made a model that was safe, secure and highly effective in work-based tasks.
OpenAI, on the other hand, has continued to focus on the consumer. Most of its recent updates have involved new features, like an AI browser, group chats, shopping tools and health agents. These are all add-ons to ChatGPT, but don’t necessarily improve the core product.
Smaller budgets and bigger dreams
It’s not just the likes of Anthropic and Gemini causing issues for OpenAI. When ChatGPT launched, the competition was scarce. ChatGPT was the chatbot and few companies were even working on AI models.
Now, the entire world is talking about it. Not only is OpenAI competing with tech giants, but it also needs to beat out the competitors across the world, with companies in China and Japan developing powerful AI models that cost far less to run.
Where OpenAI could once launch a small update and declare it a win, it now has to be extraordinary each time to exceed the many competitors that are out there.
Sure, OpenAI can go into code red, working on ChatGPT and bringing out an update that puts it in line with its competitors, but it will then somehow have to stay ahead of everyone else.
This isn’t so much a fall for OpenAI, but a realisation that it is no longer the leading force in the world of AI.
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