Daybreak If AI is expensive everywhere then why is ChatGPT cheapest in India?
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Aug 20, 2025 OpenAI has launched an India-exclusive plan for ChatGPT that makes advanced AI more accessible than almost anywhere else. This could be a boon for millions, but it raises concerns for Indian startups competing against well-funded global players. The podcast discusses the strategic implications for local businesses, emphasizing the need for relevance and trust in a market dominated by giants. Can startups like Sarvam and Krutrim find their niche, or will they be relegated to mere distributors in this evolving landscape?
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India As A Global AI Testing Ground
- OpenAI priced ChatGPT very cheaply in India to convert millions into habitual users rather than to maximise immediate revenue.
- The goal is to harvest large-scale usage and feedback to improve models and widen the lead over rivals.
Usage Data Strengthens Big Models
- Usage data in India accelerates model improvement because every prompt and correction becomes training material.
- That feedback loop increases the incumbents' advantage and makes competing on model quality harder for local startups.
Capital And Compute Are Key Barriers
- OpenAI and peers have vastly more capital and compute, making it extremely expensive for Indian startups to match foundation-model scale.
- Indian VCs rarely write the multi-hundred-million to billion-dollar cheques required to level that playing field.