OpenAI Strategy in 2026
What should Open AI do to win AI Race?
In one of our AI PM Interview Questions of our AI PM Course , we argued that Open AI should target Enterprise to create the Moat as the Raw intelligence will become commodity in future.
Sam Altman said the similar thing on podcast with Alex Kantrowitz
So let’s understand what should be the Open AI’s strategy in 2026.
OpenAI Current State
OpenAI is facing a stiff competition from Google and Deepseek. Recently OpenAI has announced a Code Red situation where all the resource has been diverted to make the GPT model better.
See in the graph below ChatGPT’s traffic is also declining since Google has launched their New Model.
Link/Credits - Click Here
Not only the traffic is declining but the Gemini Users are spending more time in comparison to the rival chatbot.
What does that mean for Open AI ? This means that OpenAI is not able to lockin the users in their ecosystem. Many people may go ahead and cancel their premium membership as well. If that happens, it can severely dent the progress of the OpenAI as this battle requires a lot of money.
What OpenAI could have Done Differently?
They should have rolled out the ad tier as they have massive 800M Active users.
By delaying an ad tier, OpenAI allowed 95%+ of their user base to remain pure cost.
An early ad model would have subsidised these billions of queries, turning the free tier from a financial drain into a self-sustaining revenue engine similar to Google Search or YouTube.
Netflix also rolled out the Ad supported tier very quickly. They shouldnot focus on the Perfect Product or getting the product right at the first time itself.
Ad product can evolve overtime as well.
How to win in 2026?
2026 can be make of break for OpenAI.
On the surface it looks like getting 3 things right
A super Smart Model which keeps evolving overtime
Lock in the users by giving them more personalised Experience and having deep memory window
and finally having enough infrastructure to serve million of People
One way they make their product sticky (meaning people want to keep using it) is through Personalisation and Memory. The AI is learning to remember your preferences and life details, acting more like a personal assistant that knows you perfectly.
This might NOT make sure that they are set to win the AI Race. They need to aggressively chase the Enterprise ( business) side of things so that they can create a real moat.
New models like GPT 5.2 are now reaching expert level in many professional tasks. In tests, experts preferred the AI's work over human work about 70% of the time for certain business tasks.
In the future, many workers might spend their time managing a team of AI bots instead of doing the manual tasks themselves.
Verticalisation vs Horizontal Chatbots
A general helpful assistant is a commodity. Basically having a specialised agents
These agents would come pre-integrated with industry-standard tools (like SAP or Salesforce) and pre-prompted with domain expertise. Once a company builds its workflow around these specific agents, the switching cost becomes astronomically high.
The main reason Vertical AI agents are expected to dwarf SaaS is because of what they replace. Standard SaaS tools are like digital toolboxes that humans use to do their work. In contrast, Vertical AI agents are the software and the people combined into one product
Going in Hardware or building Devices?
OpenAI just announced building GUMDROP which is a small, screenless, pen-shaped gadget/device. BUT why OpenAI is Building Hardware?
Currently, ChatGPT lives inside phones and browsers controlled by Apple and Google. OpenAI is worried that these competitors will bury ChatGPT behind their own AI (like Siri or Gemini). A physical device gives OpenAI a direct path to the user without needing someone else’s app store.
OpenAI isn’t trying to make a huge profit on the device itself. Instead, they want to get the device into as many hands as possible to encourage people to pay for monthly ChatGPT subscriptions basically something similar to what Amazon does with Kindle.
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Shailesh Sharma! I help PMs and business leaders excel in Product, Strategy, and AI using First Principles Thinking. For more, check out my AI Product Management Course, PM Interview Mastery Course, Cracking Strategy, and other Resources
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