- Extremely personal data on users
- Novel way of introducing and learning more about sponsored products
- Strong branding for non-techie people (most normal people don't know what Claude or Gemini are)
- An app that is getting more and more addictive/indispensable
I think OpenAI is going to kill it in ads eventually. This is why Meta and Google went all in on AI. Their lucrative digital ad business is in an existential threat.
I think people who kept saying there is no moat in AI is about to be shocked at how strong of a moat there actually is for ChatGPT.
All free LLM chat apps will need to support ads or they will eventually die due to worse unit economics or run out of funding.
PS. Sam just said OpenAI's revenue will finish at $20b this year. 6x growth from 2024. Zero revenue from non-sub users. What do you guys think their revenue will end up in 2026?
My guess: they would lose a ton of cultural cachet.
Turning OpenAI into an ads business is basically admitting that AGI isn’t coming down the pipeline anytime soon. Yes, I know people will make some cost-based argument that ads + agi is perfectly logical.
But that’s not how people will perceive things, and OpenAI knows this. And I think the masses have a point: if we are really a few years away from AGI replacing the entire labor force, then there’s surely higher margin businesses they can engage in compared to ads. Especially since they are allegedly a non-profit.
After Google and Facebook, nobody is buying the “just a few ads to fund operating costs” argument either.
Because you think it’s not?
What if I, and many other people, think that it is?