OpenAI Issues ‘Code Red’ As It Faces Growing Competition

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Google’s Gemini 3

Google has caught up with OpenAI, and the Sam Altman-led tech firm is in a manic frenzy. 

The ChatGPT maker has issued a “code red” memo to its staff, urging them to refocus their initiatives on the chatbot. OpenAI is temporarily restructuring its teams to maintain its slim lead over Google, whose Gemini 3 has sent shockwaves all over the AI ecosystem.

Gemini 3 has outperformed rivals on key benchmarks and won over high-profile users. Even Salesforce CEO Marc Benioff switched to Google’s new AI engine, noting, “Just spent 2 hours on Gemini 3. I’m not going back.”

Interestingly, Google also issued a similar alert memo to staff in 2022 amid the rise of ChatGPT. The company redirected its focus to developing and launching AI prototypes and products, and after just three years, it has closed the gap with OpenAI. Gemini 3 was rolled out via Google Search, reportedly the fastest deployment to the tech firm’s core product. 

Utter confusion

In many ways, Google’s victory lap can be attributed to it being too big and too strong. Google leveraged its dominant position in the search engine business to propel its AI initiatives.

Moreover, OpenAI’s overeagerness to win the AI race has become its weakness rather than its strength. OpenAI, widely regarded as one of the most significant pioneers of the modern AI era, now appears to be a company that lacks focus.

As part of its “code red” memo, the AI firm has pushed back its slew of initiatives in advertising, AI agents for health and shopping, and a personal assistant called Pulse. 

The firm updated its 4o model earlier this year to increase user engagement, only to claim it had been “overly flattering or agreeable—often described as sycophantic.” OpenAI then released GPT-5, which received backlash for being too impersonal. 

Set your priorities straight

OpenAI’s seeming lack of a crystal clear vision and priorities may have led to this impending fall from grace. Given that it is a tiny firm compared to Google, perhaps it would’ve been wiser to invest more in one core output than to try to be a master of everything at once. 

The AI industry is still in its nascent stage, and it’s critical to deeply understand what customers truly need. Pouring in a chunk of a company’s resources for the development of a core product turns the firm into an expert in this particular niche. 

Focusing on one offering at a time enables firms to deliver high-value products to the market consistently. Customers and stakeholders want nothing more than a reliable product or service that can directly meet their needs.

A robust and well-built core offering serves as the business’s foundation as it moves forward. Some of the best companies in the world are known for a single product or innovation that forever changed how the world works. 

Nike is known for its shoes, Coca-Cola for its carbonated drink, Amazon for its marketplace, and so on. These companies have expanded their reach across markets through a single product. Businesses should strive to perfect the core offering they want to be remembered for.

The question for your business

How does your company set its priorities?

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