OpenAI CEO Sam Altman has revealed that the company’s “code red” emergency response isn’t a rare occurrence but rather a strategic approach the company plans to deploy once or twice annually to maintain competitive dominance in the AI industry. Speaking on the “Big Technology Podcast” published Thursday, Altman disclosed that OpenAI has entered emergency mode multiple times in response to competitive threats and expects this pattern to continue.
The company activated “code red” earlier this year when China’s DeepSeek emerged as a formidable competitor in January. DeepSeek shocked the tech industry by claiming its AI model matches top competitors like ChatGPT’s o1 at a fraction of the cost, forcing OpenAI to reassess its position. Most recently, OpenAI entered another “code red” phase in early 2025, approximately two weeks after Google released Gemini 3 in November. The model received widespread praise, with Google promoting it as its most advanced AI model to date.
According to reports, Altman communicated to staff via an internal Slack memo that OpenAI would prioritize ChatGPT development while postponing other product plans. However, Altman noted in the podcast that Google’s Gemini 3 ultimately “did not have the impact we were worried it might.” Nevertheless, both DeepSeek and Gemini 3 helped identify weaknesses in OpenAI’s product offering strategy that the company is now addressing rapidly.
Since entering the latest “code red” state, OpenAI has accelerated its product releases significantly. Last week, the company rolled out a more advanced AI model designed to improve ChatGPT’s performance across professional work, coding, and scientific tasks. Earlier this week, OpenAI also unveiled a new image-generation model, demonstrating the company’s commitment to rapid innovation under competitive pressure.
Altman indicated that the current “code red” period won’t last much longer, noting that “historically, these have been kind of like six- or eight-week things for us.” The CEO emphasized that being paranoid and acting quickly when potential competitive threats emerge is essential for success. “My guess is we’ll be doing these once maybe twice a year for a long time, and that’s part of really just making sure that we win in our space,” Altman stated.
The “code red” approach isn’t unique to OpenAI. In 2022, Google declared its own internal “code red” after ChatGPT’s debut exposed the search giant’s lag in consumer AI, despite having funded much of the foundational research that enabled the AI boom.
Key Quotes
It’s good to be paranoid and act quickly when a potential competitive threat emerges.
Sam Altman explained OpenAI’s philosophy on the Big Technology Podcast, justifying the company’s aggressive response strategy to competitive threats in the rapidly evolving AI market.
My guess is we’ll be doing these once maybe twice a year for a long time, and that’s part of really just making sure that we win in our space.
Altman revealed that ‘code red’ emergency modes will become a regular feature of OpenAI’s operations, indicating the company expects sustained competitive pressure in the AI industry for years to come.
But it did — in the same way that Deepseek did — identify some weaknesses in our product offering strategy, and we’re addressing those very quickly.
Altman acknowledged that while Google’s Gemini 3 didn’t have the feared impact, both it and DeepSeek exposed vulnerabilities in OpenAI’s approach that the company is now rapidly addressing.
Historically, these have been kind of like six- or eight-week things for us.
The OpenAI CEO provided insight into the typical duration of ‘code red’ periods, suggesting the current emergency mode will conclude soon as the company has already shipped multiple product updates.
Our Take
Altman’s candid discussion reveals a fundamental shift in how AI companies must operate. The normalization of “code red” emergency responses suggests that sustainable competitive advantages in AI are increasingly elusive. What’s particularly striking is OpenAI’s willingness to publicly acknowledge this vulnerability while simultaneously projecting confidence. The rapid emergence of cost-efficient alternatives like DeepSeek poses an existential challenge to OpenAI’s premium positioning, potentially forcing a rethinking of business models across the industry. This perpetual crisis mode may accelerate innovation but could also lead to burnout, rushed products, and strategic mistakes. The AI industry appears to be entering a phase where paranoia becomes a competitive necessity, fundamentally changing corporate culture and product development timelines. For investors and users alike, this signals both exciting innovation ahead and potential instability as companies constantly pivot in response to competitive threats.
Why This Matters
This revelation provides crucial insight into how leading AI companies operate in an increasingly competitive landscape. OpenAI’s institutionalization of “code red” emergency responses signals that the AI industry has entered a phase of perpetual competition where market leadership requires constant vigilance and rapid adaptation. The fact that Altman expects to deploy this strategy twice yearly suggests the AI race will remain intense for the foreseeable future.
The story highlights the fragility of competitive advantages in AI, where breakthroughs from competitors like DeepSeek and Google can quickly threaten established players. DeepSeek’s cost-efficient model particularly demonstrates that innovation isn’t limited to well-funded Western companies, introducing geopolitical dimensions to AI competition. For businesses relying on AI tools, this competitive intensity means faster innovation cycles and more frequent product updates, but also potential instability as companies rapidly shift priorities. The pattern also reveals how AI leaders are adopting crisis management as standard operating procedure, fundamentally changing how tech companies approach product development and strategic planning in the AI era.
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Source: https://www.businessinsider.com/sam-altman-openai-code-red-multiple-times-google-gemini-2025-12