In a bold leap forward for artificial intelligence (AI), OpenAI unveiled its latest innovation on Monday—a revolutionary AI model named GPT-4o, accompanied by a desktop version of ChatGPT and an overhauled user interface. 

Say hello to GPT-4o, our new flagship model which can reason across audio, vision, and text in real time: https://t.co/MYHZB79UqN

Text and image input rolling out today in API and ChatGPT with voice and video in the coming weeks. pic.twitter.com/uuthKZyzYx

— OpenAI (@OpenAI) May 13, 2024

This release represents OpenAI’s ambitious endeavor to democratize access to its renowned chatbot technology while elevating user experience to unprecedented heights.

During a live-streamed event, Mira Murati, the technology chief at OpenAI, delivered the momentous announcement, announcing the integration of GPT-4 into ChatGPT for all users, including those on the free tier. 

In her address, Murati highlighted the significance of this development, emphasizing OpenAI’s commitment to accessibility and user empowerment.

“This is the first time that we are really making a huge step forward when it comes to the ease of use,” Murati said.

Powered by Microsoft and boasting a valuation exceeding $80 billion by investors, OpenAI faces the dual challenge of maintaining its leadership in the fiercely competitive generative AI market while navigating the complexities of monetization amidst substantial investments in hardware and infrastructure.

The introduction of GPT-4o, the latest iteration in OpenAI’s esteemed GPT series, represents a quantum leap in AI capabilities. With superior speed and enhanced proficiency in text, video, and audio processing, GPT-4o heralds a new era of AI sophistication. 

The company said GPT-4o achieves GPT-4 Turbo-level performance on text, reasoning, and coding intelligence while setting new high watermarks on multilingual, audio, and vision capabilities.

“With GPT-4o, we trained a single new model end-to-end across text, vision, and audio, meaning that all inputs and outputs are processed by the same neural network. Because GPT-4o is our first model combining all of these modalities, we are still just scratching the surface of exploring what the model can do and its limitations,” the company said in a blog post.

Notably, OpenAI envisions extending ChatGPT’s functionality to encompass video chat capabilities in the near future, further expanding the scope of interactive experiences facilitated by the platform.

“The ‘o’ in GPT-4o signifies ‘omni,‘ reflecting the model’s versatility and adaptability,” Murati explained, highlighting GPT-4o’s ability to support 50 different languages with unparalleled speed and precision. Moreover, GPT-4o will be seamlessly integrated into OpenAI’s API, empowering developers to harness its transformative potential for a myriad of applications.

“Developers can also now access GPT-4o in the API as a text and vision model. GPT-4o is 2x faster, half the price, and has 5x higher rate limits compared to GPT-4 Turbo. We plan to launch support for GPT-4o’s new audio and video capabilities to a small group of trusted partners in the API in the coming weeks,” the company said on Monday.

In a captivating demonstration of GPT-4o’s capabilities, OpenAI showcased its advanced audio processing prowess. Mark Chen, a distinguished OpenAI researcher, demonstrated the model’s capacity to discern and respond to users’ emotions, setting a new standard for human-machine interaction. Furthermore, GPT-4o exhibited remarkable adaptability, seamlessly accommodating user interruptions and dynamically adjusting its responses to suit the conversational context.

As part of its commitment to enhancing user experience, OpenAI announced plans to introduce Voice Mode—an innovative feature that enables ChatGPT to respond to audio prompts with lightning speed. Leveraging cutting-edge technology, OpenAI aims to replicate the fluidity and spontaneity of human conversation, ushering in a new era of interactive dialogue between users and AI.

Beyond its proficiency in audio processing, GPT-4o showcased its versatility across diverse domains, from storytelling to code generation. With its ability to undertake complex tasks with unparalleled efficiency, GPT-4o emerges as a formidable competitor to industry giants like Microsoft’s GitHub Copilot, positioning itself at the vanguard of AI innovation.

The company said “GPT-4o’s text and image capabilities are starting to roll out today [Monday] in ChatGPT. We are making GPT-4o available in the free tier, and to Plus users with up to 5x higher message limits. We’ll roll out a new version of Voice Mode with GPT-4o in alpha within ChatGPT Plus in the coming weeks.”

As the rollout of GPT-4o commences, users can anticipate a transformative ChatGPT experience characterized by seamless interactions, enhanced capabilities, and unparalleled versatility. With GPT-4o leading the charge, OpenAI reaffirms its commitment to shaping the future of AI and revolutionizing the way humans engage with technology.

The smiling curve is a graph that measures value against the value chain of an industry. The curve appears like a smile when value added is represented on the Y-axis and the value chain stages are represented on the X-axis. I have used it to explain competitiveness in the financial services sector.

Before 2020, most banks in Nigeria were at the center of the curve, and they captured the least value in the ecosystem even though they provided the most support. But those at the edges, usually fintech companies,  captured the most value even though they did not provide a lot of catalytic support in the ecosystem.

Fast forward today, most banks have transmuted, creating fintech units, and in the process, they are now represented at the center and the edges. As a result, these banks are now capturing great value just as the fintech firms.

Sure, there is always going to be an innovation hangover which does imply that banks may not necessarily do what fintechs do very well since they may not like to cannibalize value elsewhere.

Immediately, I knew that there was the power of monopoly in town. With PayPal, you can sign-up for free, and within minutes be getting revenue online. But yet, I do understand that Interswitch has its own cost model, running its generators and providing its security since government is largely not part of building companies in Nigeria. But was that fee appropriate just to be connected online, in Nigeria? Not really, and I felt they were making a real mistake. A big mistake because such fat profits and margins would cloud their strategies to mine all the juices with the power of monopoly and suffering later the risk of not innovating. They did not make significant efforts to expand beyond Nigeria, at scale, because they could simply charge $1,000 for integrating websites. (Sure, they did expand to Uganda, etc but generally, the pace was slow. When they started in Nigeria, they could have taken over Africa, if they had not become very comfortable in Nigeria alone.)

For example, a fintech company may wire funds from Nigeria to London for $30, and a bank’s fintech unit can match that, but because a bank’s treasury unit charges $100 for that same service, the bank may pause the launch of that product in the fintech unit. Or if they do launch it, they will modify the problem and solve something that may cost the customer $70.  This hangover is the reason upstarts can win in a world of established incumbents. Check my video on the Smiling Curve here.

The smiling curve is a graph that measures value against the value chain of an industry. The curve appears like a smile when value added is represented on the Y-axis and the value chain stages are represented on the X-axis. I have used it to explain competitiveness in the… pic.twitter.com/TeoVqdytiY

— Ndubuisi Ekekwe (@ndekekwe) May 14, 2024

Banking, Fintech and Smiling Curve: Why Where You Operate Is More Important Than Efforts You Put In

Respect the banks because they have evolved in Nigeria. Yes, “in a resounding testament to its robust performance and growth trajectory, HabariPay, the fintech subsidiary of Guaranty Trust Holding Co Plc, announced a remarkable N2.3 billion profit before tax for the fiscal year 2023.”  . Good People, the fintech unit of GTBank’s parent company, is a rainmaker of profit.

Amidst the intensifying competition in the fintech landscape, GTCo’s HabariPay witnessed astronomical growth in transaction volumes during the year under review. The value of transactions processed on the platform surged by an astounding 8,620%, reaching N12.1 billion from N139.3 million recorded in the preceding year. Additionally, HabariPay’s international payment transactions witnessed a remarkable increase from $175,927 in 2022 to $2.3 billion in 2023, signaling its emergence as a dynamic force in the financial technology sector.

According to GTCO, HabariPay’s rapid growth underscores its commitment to innovation and empowerment in the digital economy. The company’s core operations encompass a wide array of services, including a payment gateway facilitating transactions via virtual accounts, USSD, card, and bank transfer channels. Moreover, it engages in switching verticals, value-added services such as bill payments for airtime vending, and distribution of bulk SMS processed through licensed Value Added Service Aggregators authorized by the Nigerian Communications Commission (NCC).

Yes, Nigerian banks have an edge over fintechs in the Nigerian financial services sector right now. A few years ago, I postulated using the smiling curve (yes, a smiling face-like curve) where the vertical axis is Value and the horizontal axis is Positioning of companies, to explain what was happening. I noted then that fintechs in Nigeria were operating at the edges, and they were capturing a lot of value, while banks which were tethered at the center were only picking marginal value.

However, from 2021, Nigerian banks evolved, consolidating the center of the curve even as they inserted themselves at the edges of the curve. So, just like that, they built a moat at the center, even as they captured massive value at the edges, distorting the equilibrium at scale. Right now, banks have asymmetric advantages over fintech companies in Nigeria, and that is why their fintech subsidiaries are raining profits.  You can read that piece again here – “Banking, Fintech And Smiling Curve: Why Where You Operate Is More Important Than Efforts You Put In ”  

It is about positioning and not necessarily the efforts you are putting in, because where you operate is more important than the efforts you are putting in. Today, Nigerian banks have locked both the center and the edges of the smiling curve, and that is why they’ve become super-profitable!

Respect the banks because they have evolved in Nigeria. Yes, "in a resounding testament to its robust performance and growth trajectory, HabariPay, the fintech subsidiary of Guaranty Trust Holding Co Plc, announced a remarkable N2.3 billion profit before tax for the fiscal year… pic.twitter.com/QtbtiN6QZd

— Ndubuisi Ekekwe (@ndekekwe) May 13, 2024

In a resounding testament to its robust performance and growth trajectory, HabariPay, the fintech subsidiary of Guaranty Trust Holding Co Plc, announced a remarkable N2.3 billion profit before tax for the fiscal year 2023. 

This impressive figure represents a staggering 147.9% surge compared to the N944.7 million recorded in the previous year, as revealed in the company’s full-year 2023 financial presentation to investors.

The surge in profitability mirrors the exponential increase in revenue experienced by HabariPay during the period under review. According to the 2023 financial report, the fintech company’s gross revenue skyrocketed by an impressive 218%, reaching N4.905 billion compared to N1.542 billion in 2022. This remarkable growth was underpinned by significant advancements across all key income streams.

“Income from Value Added Services saw a remarkable growth of 149%, driven by airtime vending revenue from direct integration with two major Telcos, as well as strategic partnerships with Value Added Service (VAS) aggregators,” the company reported. 

Furthermore, the report highlighted the efficient management of interest expenses, which resulted from monthly overdraft charges on airtime purchases. HabariPay meticulously monitored airtime sales on a monthly basis, ensuring a credit balance on its overdraft account at the end of each month.

Astronomic Transaction Growth

Amidst the intensifying competition in the fintech landscape, GTCo’s HabariPay witnessed astronomical growth in transaction volumes during the year under review. The value of transactions processed on the platform surged by an astounding 8,620%, reaching N12.1 billion from N139.3 million recorded in the preceding year. Additionally, HabariPay’s international payment transactions witnessed a remarkable increase from $175,927 in 2022 to $2.3 billion in 2023, signaling its emergence as a dynamic force in the financial technology sector.

According to GTCO, HabariPay’s rapid growth underscores its commitment to innovation and empowerment in the digital economy. The company’s core operations encompass a wide array of services, including a payment gateway facilitating transactions via virtual accounts, USSD, card, and bank transfer channels. Moreover, it engages in switching verticals, value-added services such as bill payments for airtime vending, and distribution of bulk SMS processed through licensed Value Added Service Aggregators authorized by the Nigerian Communications Commission (NCC).

Evolution and Expansion from Little Beginning

HabariPay’s journey reflects an evolution from its inception as part of GTBank’s Habari super-app in 2018 to its current status as a standalone business entity within the Guaranty Trust Holding Co Plc ecosystem. Originally conceived as a multifaceted super-app offering streaming content and an e-commerce marketplace, Habari struggled to gain traction among digital users. 

However, a corporate restructuring in 2020 led to Habari’s transformation into a separate entity wholly owned by GTBank, signaling the bank’s broader push into digital payments.

With the transition of Guaranty Trust Bank into a holding company in June 2021, HabariPay emerged as a standalone business offering comprehensive payment solutions, an expansive marketplace, and tailored services for small businesses. Its flagship product, Squad, combines a robust payment gateway and e-commerce platform with a Point-of-Sale business, positioning HabariPay as a formidable competitor in the payment gateway sector alongside industry giants such as Interswitch, Paystack, and Flutterwave.

As HabariPay continues to chart its course in the ever-evolving fintech ecosystem, its journey from inception to becoming a standalone entity within the Guaranty Trust Holding Co Plc ecosystem is a testament to its resilience and adaptability. From its humble beginnings as part of GTBank’s Habari super-app to its transformation into a standalone business offering comprehensive payment solutions, the company’s growth underscores its commitment to driving innovation and empowering businesses.

With its flagship product, Squad, combining a robust payment gateway with an e-commerce platform and Point-of-Sale business, HabariPay is poised to carve a niche for itself alongside industry giants. Its journey is not just a story of profits and growth but a testament to the transformative power of innovation and determination in the face of intense competition.