>They are making money somehow

Extremely doubtful. Microsoft went in for $10B at a $29B valuation. We have seen pre-revenue companies IPO for far more than that. Microsoft's $10B deal is probably the only thing keeping them afloat.

>Hence the space is ripe for tons of competition

I think you should look up which big tech companies already offer chatbots. You'll find the space is already very competitive. Sure, they aren't large, generative language models, but they target the B2C market that ChatGPT is attempting to compete in.