Indian-origin former US government tech advisor has an OpenAI ‘warning’

A former US government tech advisor has warned the Trump administration about the potentially high cost of OpenAI and Anthropic's "$1-a-year deals." Sid Ghatak, who served as tech advisor during the Biden administration, said that the US government should consider the hidden costs of implementing artificial intelligence (AI), which he believes could be significant.

This comes after OpenAI and Anthropic recently announced they would provide federal workers with a year’s access to their AI models for a token fee of $1 per agency.

What former US government tech advisor Sid Ghatak said about the $1 AI deals

In an interview with Business Insider, Ghatak cautioned that the government may need to allocate additional funds to train an AI model tailored to its specific requirements. He said, “What does $1 really mean? Does that mean access to the open model and that compute will be charged incrementally?”"So, there are all of those costs in terms of training, and then once you have built the model, does the government have to pay for inference whenever federal workers and contractors use it? Is there another incremental charge?" Ghatak added.He also noted that the expenses of using AI go beyond payments to companies like OpenAI and Google, as the government will also need to invest heavily in consolidating its data for AI.“The government has to be really careful and understand what the fully loaded cost is of these solutions beyond the very attractive zero to $1 charge. These AI models are powerful engines, but they require really fantastic data to run cleanly and produce reliable output. The investment in that is something that needs to be understood,” Ghatak explained.

Ghatak, former GSA director (2020–2024) who helped shape Biden’s 2023 AI executive order and co-authored the government’s AI Maturity Model, later founded Increase Alpha, an AI-driven stock prediction platform.Apart from these deals, OpenAI has also been deepening its government ties. In June, the US Department of Defence revealed it had awarded the company a $200 million contract to build AI tools for national security use.