What you need to know
ChatGPT seems to be on a downward spiral, experienced a decline in website visits three months in a row.
Similarweb, a research firm, believes that the decline in ChatGPT's user base might be attributed to summer break, which explains the gains in August as students began returning to school.
The average time spent by users while leveraging ChatGPT's capabilities has dropped from 8.7 minutes in March to 7 minutes in August.
In August, a new report surfaced online indicating that OpenAI's AI-powered chatbot, ChatGPT was on the verge of bankruptcy. High operational costs and varied interests were the main reasons for this issue.
Like its competitor, Microsoft's Bing Chat, ChatGPT seems to be on a downward spiral. According to a report by Business Insider, August marked the third month consecutively showing a decline in the number of visits to ChatGPT's website, as spotted by Business Insider.
Per statistics shared by Similarweb, the AI hype experienced part of last year and the beginning of the year seems to be toning down. Putting this in perspective, the average time spent on ChatGPT dropped from 8.7 minutes in March to 7 minutes in August, as highlighted by the folks at Reuters.
However, ChatGPT's downward trajectory seems to have eased up in August, with a 0.4% increase in website visits in the US alone, though it still experienced a 3% drop worldwide.
Similarweb believes the drop in website visits was a result of the summer break, which explains why the traffic trend stabilized a tab in August during the back to school season.
A demographic shift in ChatGPT also dovetails with student use of the website dropping over the summer. Similarweb doesn’t track underage internet users, but we can use the pattern of use for college age students as a proxy for use by students in general. In the US, traffic dropped 10% in May, 15% in June, and another 4% in July, while over those same months the percentage of users in the 18-24 year age bracket – which had been pushing 30% in April – dropped to less than 27% by July.
Analysis: Hype isn't ChatGPT's only problem
I recently listed several reasons why professionals shouldn't be worried about generative AI and that the technology still has a long way to go before organizations can replace human beings with AI at workplaces.
ChatGPT, in particular, is currently under investigation by the FTC. The Commission seeks to determine whether OpenAI has breached consumer protection laws.
Ideally, the Commission doesn't have the mandate to make new laws, but that doesn't prevent it from giving recommendations to the US government that will be used to moderate the development of AI models. This will negatively affect Microsoft's Bing Chat if the Commission recommends new laws that restrict and limit the chatbot's access to resources. This will ultimately affect the chatbot's accuracy.
Not forgetting the reports indicating that ChatGPT is getting dumber despite OpenAI's investments in new features and improvements. Only time will tell if this declining trend will continue for ChatGPT or if OpenAI will be able to turn things around.