What AI Vendors Actually See

Module 3 · Section 2 of 7

What AI Vendors Actually See

When you type into ChatGPT, Claude, Gemini, or any similar tool, the text you enter goes to that company’s servers. This is obvious when you think about it, but people often behave as though the chat window is private in the way a local application is private. It is not.

What varies — and matters enormously — is what happens to that data after it arrives.

Free tiers typically use your conversations for model training unless you specifically opt out. OpenAI’s free tier collects conversation data for training by default. The opt-out exists but requires finding it in settings. If you have never looked for it, you have not opted out.

Paid personal tiers (ChatGPT Plus, Claude Pro) generally offer better data handling. OpenAI’s paid tiers do not use your conversations for training by default. Anthropic states clearly that Claude Pro conversations are not used for training. This does not mean the data is not stored — it means it is not used in that specific way.

Enterprise and Team tiers are a different category. These typically include zero-retention agreements, meaning conversations are not stored beyond the session, explicit data processing agreements under GDPR or equivalent regulation, and contractual commitments about how data is handled. If your organisation is using AI tools for work involving client information, confidential strategy, or regulated data, this is the tier that is appropriate.

Local models are a fourth option worth understanding. Tools like Ollama allow you to run AI models entirely on your own hardware. Nothing leaves your machine. The tradeoff: the models are smaller and less capable than the frontier models, but for many tasks — summarising documents, drafting text, answering questions about your own files — they are entirely adequate. For handling genuinely sensitive material, local models deserve serious consideration.