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- ~1 billion users in just 3 years - Extremely personal data on users - Novel way of introducing and learning more about sponsored products - Strong branding

- ~1 billion users in just 3 years - 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?

Andrex 11mo ago
Spinning up an all-new ad network is pretty tough. I would think OpenAI would need to beat Meta/Google on basics like CPM in order for the network effects to make it desirable for ad vendors over Meta/Google. Ad budgets are fixed and zero-sum and vendors (in my head, I don't know) would prefer to spend their money on the best network giving the best results. I don't know if ads in LLM chats can get there.
- rs186 11mo ago
  If Apple can build an ad system within the app store, I don't see why OpenAI can't do that for ChatGPT.
  - chroma205 11mo ago
    > If Apple can build an ad system within the app store, I don't see why OpenAI can't do that for ChatGPT. Because Apple iPhone users have no alternative. But Google Gemini is right there for Gmail, Google Docs, and Google Workspace users.
- kavrick 11mo ago
  Microsoft owns a big chunk of them and already has a big network. Why not just use theirs?
  - rs186 11mo ago
    Why would OpenAI want to use and pay for any of Microsoft's products unless mandated by a contract? OpenAI has the talent to roll out and run their own ad product that is better and more efficient. Why pay Microsoft for a core part of their (future) business? P.S. In case you haven't noticed, OpenAI demos are done on Macbooks. Microsoft could not even get them to use Windows.
    - CharlieDigital 11mo ago
      Microsoft runs many of their demos on MacBooks. You missed the memo that Windows OS is no longer their bread and butter. Go check their GH OSS projects (e.g. .NET) and all of them have have shell scripts alongside PowerShell.
- aurareturn 11mo ago
  I'm betting that they can. Here's an idea that just popped into my head: ChatGPT shows a sponsored entry in chat history list with a colorful border around it to get users to click. This product is something that ChatGPT knows the user desperately needs from previous chats. The user can chat directly with the product and learn more about it. The advertiser specifically sent OpenAI information (like a RAG) about their products buyers might have questions for. When the user is ready, they can open a link to the product's website or just buy directly in ChatGPT.
  - nerdponx 11mo ago
    They can also suggest chat topics. Like how Reddit ads are meant to look like threads. "Frustrated with food baked on dishes? Let's chat about it! (sponsored)"
  - mattlondon 11mo ago
    But the missing part is "we know they need this!" but they don't have the ad network to have the pixels on the vendor sites to track the conversion (or not for remarketing!). They only have half (at most) of the picture. This is why they tried to create a browser (remember that? Nope me neither) to try and get the full picture. Advertisers are accustomed to pay for conversions now. If you can't track it, you cant prove it happened. Open ai will need to spin up the entire infrastructure (Inc sales teams, support teams, servers etc) to run the ad network. Not impossible but it is a big lift and they're already burning money. Their best bet is probably to just sign up for selling their ad space with Google, like all the other apps and websites do
    - DrewADesign 11mo ago
      I think the amount of money they’re burning on their operations would make that organizational lift a drop in the bucket. A few dozen annual 6 figure salaries? A few hundred? A bunch of normal CPU-based AWS services? They must spend 10 million per day on their current operating expenses.
      - mattlondon 11mo ago
- dktp 11mo ago
  Spotify, Netflix, Amazon Prime, Reddit, Twitter etc all have increasingly profitable ads I'm sure llm providers will also figure it out in due time. Consumer products are generally a good fit for ads, even if it takes time to reach full potential
  - raw_anon_1111 11mo ago
    Every single one of those companies have ridiculously low marginal cost per request compared to ChatGPT and much lower fixed costs and continued development costs.
- fweimer 11mo ago
  I thought that most advertisers go through middlemen and do not do business with the ad networks directly? So you only have to make it attractive for the middlemen (of which there are fewer), and that shouldn't be a problem for anything AI-related. Furthermore, anyone offering some sort of assisted browsing service is automatically in the ad business, regardless what they do with affiliate links in generated page summaries.
  - mcny 11mo ago
    Oh yeah and on top of that these companies like WPP hate the fact that Google and Facebook refuse to share more information with them. They can't wait to jump ship.
- rco8786 11mo ago
  They have all the resources anyone could possibly need to do this, including an enormous list of companies who would kill to get their products into ChatGPT. It’s “just” an execution challenge.
- dylan604 11mo ago
  Why would they need to beat Meta/Google, and at what game? They just won’t let any other add network work in their app. Voila! You just beat Meta/Google, and they didn’t even compete with them. I guess they could provide some sort of SDK for websites to embed that tracks users, or they could come up with a browser extension that tracks users too. They already have an app that people are freely giving them so much info. Where else could the compete as you suggest? Being a generic ad platform to serve ads not through their app?
- jpalomaki 11mo ago
  If OpenAI manages to get the agentic buying going, that could be big. They could tie the ad bidding to the user actually making the purchase, instead of just paying for clicks.
- dolphinscorpion 11mo ago
  They have enough money for it, and they hire former Google and FB execs. As long as they have eyeballs, it will work.
- delaminator 11mo ago
  Is it harder than spinning up a multi billion dollar data centre network with other people’s money? Partner branding would be a mechanism to get the ball rolling - and some are big names. Oracle, Shutterstock, BuzzFeed, Bain & Company, Salesforce, Atlassian, Neo, Consensus,
Xenoamorphous 11mo ago
I agree 100% with you. In this niche forum people keep saying “there’s no moat”. But the moat is the brand recognition, if I ask my 70yo mum “have you heard of Gemini/Claude” she’ll reply “the what?”, yet she knows of ChatGPT. Does Coca Cola have a moat? Some company could raise $1B to create a new cola beverage that beats Coca Cola in all blind tests imaginable yet people will keep buying Coca Cola. Did people switch search engines or social networks when Google or FB introduced ads?
- dkdcio 11mo ago
  I don’t disagree but want to go on the record predicting this will collapse on itself spectacularly and OpenAI will still “fail” commercially for the Cola Cola drinkers, the product goes from an infallible AI to with no ulterior motives to another Google that’s purpose is to sell you ads, but more creepily. it’s like if Coca Cola started adding a few milliliters of bleach to their product
  - tensegrist 11mo ago
    normal people don't have the same expectations as you when it comes to how much a given service should know about them, is the thing "how did X know whose profile you saw on Y service" "the computer knows everything i do on the computer, what do you mean"
    - jon-wood 11mo ago
      This isn’t backed by the constant conspiracy theories about voice assistants listening to everything you say and then farming that off to third party ad providers so that you see ads for things you’ve been discussing.
      - solumunus 11mo ago
        People moan about that but it doesn’t change their consumer habits at all.
iLoveOncall 11mo ago
Trust in LLMs is easily broken, and many users are starting to see the cracks. Once those AI companies start rolling out ads inserted in the answers, the quality will go down even more, and they will burn the last good will of the people. There is no moat because their only way to make money is to self-destruct. Talking on a more practical POV, your cost to display the ads needs to be lower than what companies pay you for advertising. And while companies might be willing to pay a small premium for "better" targeting because the LLM supposedly has more personal data about users, the cost to deliver those ads (generating answers via LLMs) is several orders of magnitude higher than for traditional ads served on websites. So even sticking to a purely technical aspect, ads might simply not be profitable when integrated in LLM answers. Combine the two aspects, and OpenAI is all but a dead company.
- fn-mote 11mo ago
  > ads might simply not be profitable when integrated in LLM answers. This is wishful thinking. Companies are using LLMs for development. The ads are not for a $50 throw pillow, they are for a $10k monthly business-critical service. Consumers might not be worth advertising to (although I doubt it), but B2B ads - absolutely.
  - delaminator 11mo ago
    If there is a $10k monthly business critical service, are ChatGPT ads going to sway you?
lenkite 11mo ago
Only a short matter of time before agentic tools start serving ads too - paying user or not. You want to refactor your codebase ? No issue - taking 30 seconds - please view this ad meanwhile.
- nerdponx 11mo ago
  Extra convenient because people are already used to these things taking several seconds to respond.
- mmoll 11mo ago
  You won’t just be viewing an ad, you will have to actively engage in a minute long sales talk with the LLM.
  - placatedmayhem 11mo ago
    In my head, it'll be like the high pressure timeshare sales pitches or the dreaded car sales transactions, where they pull out all the tricks to convince you to buy something you don't actually want or need, regardless of whether you can afford it.
    - simianparrot 11mo ago
      “That’s a great point about your finances. But did you know this company offers credit to someone in your position for only this low interest? I can apply on your behalf if you just sign this statement”
  - teeray 11mo ago
    “We’ll finish up your feature soon. In the meantime, have you considered a timeshare in Vegas?”
  - jijijijij 11mo ago
    The code will come out just fine, so your atrophied brain will remain dependent on OliCorp's parasocial prosthesis for strenuous thinking, dissolving wariness in experiences of super productivity. Then elsewhere, when plausible, OliCorp will progressively nudge you in some direction sold as predefined weight bonus to third party customers. You won't even notice and really, isn't it a fair price for all that productivity? Of course, AI isn't always right yet, but I'd say in a very practical 95% of cases your goals and expectations are in alignment with OliCorp AI. Don't forget, every website and service monetized automated access as a consequence of the AI scraping boom and made unauthorized web-indexing impossible, traditional search dried off. And when OliCorp finally turned off access to their legacy index monopoly in favor of AI interfacing, you really have no choice but to trust your friendly chat buddy. Who else are you gonna ask for the fix? Former friends, your family or neighbors? People you've grown to hate because sympathetic local clustering is discouraged through four color divisive information shaping. I mean, those guys really are at fault for your lack of self-efficacy, the hate is warranted. And you're too tired to bother anyway.
the_real_cher 11mo ago
People talk about LLMs and chatGPT in the same breath. Just like how people used to say 'google it' They now say 'look it up on chatGPT'. They have the cultural mind share which is more important than anything.
- mattlondon 11mo ago
  I ask people this. In the UK at least it seems like chatgpt is not so pervasive to the folks I talk to. "Oh that AI mode on Google search?" is potentially more common from "average" people. I hear that it is very popular in schools though as everyone is always looking for the best way to cheat and ChatGPT got viral that way earlier. Not sure being "the cheating app" is a great look though? Advertisers are very sensitive to the surfaces they are displayed on - do they want to appear in the app being used primarily to cheat on homework?
logifail 11mo ago
> 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 Given one can (at least for the moment) export one's entire chat history from ChatGPT, what exactly would stop a ChatGPT user from switching to an alternative if the alternative is either better, or better value?
- android521 11mo ago
  The answer is friction. What % of this billion of users will bother to export their chat history (which is already a lot) and import another another llm. That number is too small to matter.
  - adam_patarino 11mo ago
    Since each chat is virtually independent there’s no switching cost. I’ve moved between Claude and ChatGPT with no cares. It’s not like Facebook where all my friends stay behind
    - aranelsurion 11mo ago
      > Since each chat is virtually independent That hasn't been true for a while though. Open a new chat tab in ChatGPT and ask it "What do you know about me" to see it in action.
      - downsplat 11mo ago
        You can turn that off. If you're using LLMs for technical or real world questions, it's nicer for each chat to be a blank slate.
        aranelsurion 11mo ago
        You can also use Temporary Chats for that.
  - swexbe 11mo ago
storus 11mo ago
They can easily LoRA-finetune each model based on user preferences expressed in the past conversations. That would improve accuracy compared to Google's ad targeting by orders of magnitude.
emsign 11mo ago
Yeah, ChatGPT is dead now.
- chroma205 11mo ago
  > Yeah, ChatGPT is dead now. Not dead yet. But definitely bleeding. CharGPT lost 15-20% market share to Gemini in second half of 2025.
Hamuko 11mo ago
>Sam just said OpenAI's revenue will finish at $20b this year. 6x growth from 2024. How much did their profit grow?
reeredfdfdf 11mo ago
"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." I'm not sure that really is the case. Most non-techies I know use ChatGPT far less than they use Google search, let alone various social media apps they're addicted to. Perhaps it is a threat to Google search, but I can't see how it's going to be threat to ad revenue from Meta, Youtube etc - the services that are actually addictive due to the content they serve. At least for me there's absolutely nothing addictive about ChatGPT. It's just a tool that helps me solve certain types of problems, not something I enjoy to use.
bpt3 11mo ago
What do they have that's more personalized than Google search history for the vast majority of users?
- aurareturn 11mo ago
  I've uploaded multiple medical reports of mine to ChatGPT over the last few years. ChatGPT knows more about my medical than my doctor.
  - bpt3 11mo ago
    Most people do effectively the same with Google searches.
afavour 11mo ago
> most normal people don't know what Claude or Gemini are In think the point is that they don’t need to know what Gemini is, they just need to know Google, which they most definitely do. IMO ads rollout won’t be as simple as you’re describing it. A lot of people have switched from Google search to AI specifically because it isn’t filled with SEO, ad filled nonsense. So they’ll need to tread very, very carefully to introduce it without alienating customers. Not to mention mollifying advertisers who are nervous what their product will be shown alongside and OpenAI will probably struggle to offer iron clad guarantees about it. And people generally speaking don’t like ads. If competitors like Google are able to hold out longer with no ads (they certainly aren’t wanting for ad display surfaces) they might be able to pull users away from OpenAI. IMO pivoting to ads is a sign of core weakness for OpenAI. Anyone trying to set up their own ad network in 2025 has to reckon with Google and Meta, the two absolute behemoths of online ads. And both also happen to be major competitors of OpenAI. If they need ads that’s a problem.
- falcor84 11mo ago
  Yeah, I saw several people who only first tried AI chats on Google's new "AI Mode", which uses Gemini, but doesn't mention it anywhere.
  - lxgr 11mo ago
    Even “AI mode” isn’t mainstream yet, at least in my observation. “AI summaries” are, but they seem to be powered by an even weaker model.
  - A4ET8a8uTh0_v2 11mo ago
    I am not exactly a great example ( exposure to work model, ollama, local models play ) and I actually liked gemini upon try in google search ( which is amusingly now banned at work ), but the nice quickly fell into not nice, when it started giving me weird pushback on operation paperclip book ( I am assuming chapter discussing tabun triggered something. This is my only real problem with gemini. By comparison, I am not running into guardrails with gpt nearly as often.
- 11mo ago
isodev 11mo ago
> - Extremely personal data on users - Novel way of introducing and learning more about sponsored products Doesn’t anyone think this is really, really bad idea? We managed to radicalise people into the rise and fall of entire countries through analog ads, can you imagine how devastating it would be to infuse every digital product with all that?
- tomaskafka 11mo ago
  That’s how I read it, I’m surprised it would be meant as a positive (except for investors)
- aurareturn 11mo ago
  No, I don't think it's really bad. Most of the world doesn't care. Only in a small tech niche on the internet do they care a lot.
  - isodev 11mo ago
    Are you sure? Because most of the world also doesn’t know how “this cloud thing” works… I think we need global, EU style consumer and data protection constraints before stepping into LLM-powered ads through personal assistants.
  - LastTrain 11mo ago
    I just got back from Thanksgiving holiday with my family. Grade schools kids all the way up to great grandparents up to 81 years old. Engineers, active military, a nurse, high schoolers, two in college. Both coasts represented and Texas. Republicans, Democrats, and in-between. The one and only thing every single person had in common was an utter hatred of AI. And it wasn’t for a lack of understanding of how it will be used.
    - fn-mote 11mo ago
      Hatred of AI won’t stop others from steamrolling them and their jobs using AI. At this point, I have stopped hoping that LLMs will become vaporware.
materielle 11mo ago
I think investors would certainly love this. So why hasn’t it already happened? 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.
- lazide 11mo ago
  Aka you need them deep enough into the trap they can’t escape, before you trigger it.
  - smallmancontrov 11mo ago
    Yes and there are layers. Remember when google ads had yellow backgrounds? I'm sure OpenAI will find a way to do ads "ethically"... for a while, until people get comfortable, and that's when they will start to make ChatGPT increasingly manipulative.
    - lazide 11mo ago
      Gotta make that line go up and to the right!
      - smallmancontrov 11mo ago
        > The goals of the advertising business model do not always correspond to providing quality search to users. - Sergey Brin and Lawrence Page, The Anatomy of a Large-Scale Hypertextual Web Search Engine
  - SketchySeaBeast 11mo ago
mejutoco 11mo ago
I do not understand why the conversation is always about showing ads in chatgpt. Can they not track users there without ads and sell ad space on websites like google ads? Why ruin the experience there when they can highly target ads. I am guessing they prefer both.
- jsnell 11mo ago
  There is nowhere near enough money in the ad network business. Like, Google's search ad business is an order of magnitude higher than the ad network, and the ad network has been shrinking in absolute terms for years while the first party revenue has been growing at double digits.
- A4ET8a8uTh0_v2 11mo ago
  Eh, so.. I don't know if I was in some weird A/B testing group, but I saw lazy reference to real estate ( zillow ) in my chat few weeks ago, which was .. I had to think of a way in how 'not close' it was to our conversations. And the issue is clearly not that it can't profile me. It absolutely can. And I sometimes ask for some explicit shopping comparisons. But what do I get, real estate ad..lazy. Lazy and uninfuckingspired.
faithlv 11mo ago
Clammy Sam says all sorts of shit, his word has little value.
__MatrixMan__ 11mo ago
It seems like you could make a sort of seive out of multiple free models such they each remove each other's ads.
A4ET8a8uTh0_v2 11mo ago
I think the real question is: what are you doing to make it less painful? Full disclosure, chatgpt has a lot on me, but I am using to this time to prep nice local build. It has gotten really nice and current crop of machines with ai395 got really nice ( I almost wrote a short page over how easy it was compared to only few years back ).
ori_b 11mo ago
And the ads can be blended seamlessly into generated content. "You can do this in Postgres, but the throughput will be limited. Consider using hosted clickhouse instead. Would you like me to migrate your project?"
dangus 11mo ago
You are 100% correct, and I don’t mean to refute your comment by saying this: For me personally, the moment AI has ads, I’m out. I’ve drawn this line with search engines as well. I now pay for a no-ads search engine. But for AI, I think I’d rather buy some hardware or use my existing desktop PC and run something local with search engine integration. I know this won’t be a popular option but I think this time around I’ll just skip the ensgittification phase and go straight to the inevitable self-hosting phase.
- Workaccount2 11mo ago
  They will certainly offer privacy focused ad-free models. Enterprise demands it. However you will have to pay the full true cost of each token. Not the promo pricing like we have now or the ad-subsidized plans that will be offered.
- fn-mote 11mo ago
  > the moment AI has ads, I’m out HN users run adblockers. The usual estimate is that people who run adblockers are with $0, so don’t worry about them. Now — normal people did not used to run adblockers, although in my circles (young demographic) that has changed more than I expected.
- shinycode 11mo ago
  I second that, trust is broken if there is ads. The line of great ads to weird ads to pushy-borderline-scam ads into personal context is thin. Hopefully the price of local will go down and maybe apple will be able to push most of it on-device. The day chatGPT push ads in a conversation I stop using it. The thing is with llm, it went so fast to get that many users, it means people are used to adopt new stuff as well. With proper marketing and specific feature I won’t be surprised to see people switch service as easily they start using it in the first place because the barrier is so low.
micromacrofoot 11mo ago
the moat is always ad networks in the end... open ai figured out a new way to accumulate users to show ads to
tarsinge 11mo ago
I’m actually one of the people that continue to say even with this list they have no moat, because Google, Facebook, Microsoft, etc. can just embed a chatbot in their existing products or social network and make ChatGPT irrelevant overnight. Non tech users will chat through their browser, OS, Apps, website, that’ll be served by any model provider. The only moat of OpenAI is investor money to burn so that they can offer it for free. Also 20 billions of revenues, not profits, is orders of magnitude too low compared to their expenses. Their only path to survival is a massively downgraded free tier ridden with ads. Nobody will use an app like this when they can have a better more integrated experience directly in their other apps.
- NewsaHackO 11mo ago
  What do you mean the can? All of those services have already done this, but they have not slowed ChatGPT down.
- marcosdumay 11mo ago
  > Also 20 billions of revenues, not profits, is orders of magnitude too low compared to their expenses. Nah, it's just one order of magnitude... Also, they expect revenue to grow exponentially so it's 20 billions annualized by the end of the year. Last time I saw somebody talk about it, it was about half of it, and trending down. Anyway, if they manage to take ~20% of the ads revenue from Google, they will be able to cover ongoing depreciation! That's the amount of money they need.
  - ViewTrick1002 11mo ago
    The problem is that inference is a whole different ballgame in terms of costs compared to a traditional SaaS model where each extra customer adds near zero in cost. They may make it work but OpenAI is more akin to a traditional high revenue low profit business like for example a grocery store. Thats why we are seeing the explosion of extra tools to try lock in business for higher value use cases and not fight on the margin.
    - delaminator 11mo ago
insane_dreamer 11mo ago
> (most normal people don't know what Claude or Gemini are) They just use Google, with "AI Overview" at the top. Google's in a strong position still. Claude, I agree. IMO that's why Anthropic is so heavily focused on coding and agentic tasks -- that is its best option (and luckily, not ad-based)
lm28469 11mo ago
The problem is that going for ads basically is an admission that AGI is nowhere close to what they pretend. People are valuating it for "skynet is around the corner" not "we're going to kill our product by polluting our answers and inserting ads everywhere"
- emp17344 11mo ago
  Hopefully this is the point where AI starts to be seen as just a useful tool, as opposed to a sign of imminent AGI. I’ll be glad to hear less rabidly overzealous rhetoric surrounding AI.
aranelsurion 11mo ago
Also ads in LLM can be perfectly merged with the content, it'd be impossible to know if LLM tells you something because that's the most likely useful answer or the most profitable one for its owners. Can't be just ad-blocked either, it might be the ultimate channel for ads. > how strong of a moat there actually is for ChatGPT. None of the above requires OpenAI to be around though. Google, Apple and Microsoft each have much stronger brands, and more importantly they each own large platforms with captive audiences where they can inject their AI before anyone else's and have deeper pockets to subsidize its use if need be. Everywhere OpenAI opens up shop (except for Web) they're in someone else's backyard.
- logicallee 11mo ago
  it could just have a section called - Ad - And include an ad section within the text. Alternatively, if it tells you something because that company is a sponsor, it could just include an appropriate disclaimer.
- jcfrei 11mo ago
  "Using chatgpt" is now synonymous with talking to an AI. I wouldnt underestimate their brand recognition and moat.
raw_anon_1111 11mo ago
It’s an entirely different skillset to create technology $x than it is to create a successful ad network. Yahoo is the canonical example. It has been one of the most trafficked websites in the world through most of its history and still wasn’t able to successfully sell ads after the dot com bust. ChatGPT’s revenue means nothing if reports are to be believed that it loses money on each paying customer on just inference. It’s definitely not enough to support its training costs. Also, I think I remember estimates that it costs 10x as much to serve a ChatGPT result than it does for Google to serve a search result. Not to mention that Google uses its own hardware including TPUs.
- aurareturn 11mo ago
  ChatGPT’s revenue means nothing if reports are to be believed that it loses money on each paying customer on just inference. It’s definitely not enough to support its training costs. Sam Altman: We're very profitable on inference. https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Subscribe,2025%20at%2012:53%20am https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Su... Independent analysis: Inference is very profitable. https://martinalderson.com/posts/are-openai-and-anthropic-really-losing-money-on-inference/ https://martinalderson.com/posts/are-openai-and-anthropic-re... https://www.snellman.net/blog/archive/2025-06-02-llms-are-cheap/ https://www.snellman.net/blog/archive/2025-06-02-llms-are-ch...
  - raw_anon_1111 11mo ago
    Fair enough, I haven’t updated my assumptions in quite a while.
Rebuff5007 11mo ago
I think the good news is that open-source models are a genuine counterweight to these closed-source models. The moment ads become egregious, I expect to see and use services for an affordable "private GPT on demand, fine-tuned as you want it" So instead of a single everything-llm, i will have a few cheaper subscriptions to a coding llm, a life planning llm (recipes, and some travel advice?). Probably it.
qwertox 11mo ago
> This is why Meta and Google went all in on AI. Google, Microsoft, Meta and Amazon, among others, would have zero issues in ensuring that OpenAI does not grab a market they own; it shouldn't be that hard to bring OpenAI into a position where they cannot recoup their investments, hence going bankrupt. The big players then would also have the benefit of having those very bright minds being on the market for them to grab. And it's not like OpenAI owns much relevant hardware. Let's see where we are in 3-4 years.
- jcfrei 11mo ago
  Microsoft is financially backstopping OpenAI - they are not a competitor.
  - qwertox 11mo ago
    Microsoft is using them in order to be better positioned than other big players, and they succeeded, even if Google is now starting to catch up. They can withdraw their support when and how they see fit, own exclusive IP rights to OpenAI's models and the hardware is their own anyway. They only lack the researchers, but they'll then be on the market.
outside1234 11mo ago
Honestly, I switched to Gemini and really haven’t missed anything. My wife just makes a google search with her “prompt” and doesn’t use ChatGPT. There might be a moat, but there are also extremely well funded competitors that make this moat a lot smaller.
an0malous 11mo ago
Sam is a habitual liar so I wouldn’t take anything he says seriously. LLMs are a commodity, once they put in ads people will increasingly move to the other options. It works for Google because they have a moat, OpenAI does not. There’s a reason they didn’t do this earlier. It’s going to piss people off and they’ll lose a lot of users.
grafmax 11mo ago
Tried and true Silicon Valley strategy: burn VC money to build a moat, wait until switching costs are high enough, and then enshittify the product to extract rent. Dont forget to call it progress.
cmckn 11mo ago
I think ChatGPT’s moat is mostly “it’s the first AI thing I used/heard about”. It’s not clear to me that’s enough to maintain their market share if OpenAI is the only one mixing in ads. It does seem to work elsewhere, though; consumers have brand loyalty to a fault, and often for the brand they started with.
- fragmede 11mo ago
  The question is how many users have developed intimate personal relationships and have named their ChatGPT, and how many of them would bounce to a different provider if some line is crossed (of which advertising could be one)? Anecdata isn't data, but I know several individuals who have and thus are even more unlikely to churn than mere brand loyalty on the level of eg Coca-Cola.
  - ares623 11mo ago
    I’m curious how that intimate relationship evolves once ads are in play. Wait we don’t need to wonder. The chatgpt 5 rollout showed us exactly what happens when the intimate friend changes.
- randyrand 11mo ago
  That’s basically Google’s search moat too.
  - zer0tonin 11mo ago
    No, Google was 10x better than any competitor until they started actively sabotaging their search product in the past 5 years or so. ChatGPT feels like an inferior product when compared to Claude or Qwen.
positron26 11mo ago
> 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. Game on. The systemic risk to the AI build-out happens when memory management techniques similar to gaming and training techniques that make them usable reduce the runtime memory footprints from gigabytes to megabytes, much of which fits in L2. When that happens, the data center will bleed back to the edges. Demand will find its way into private, small, local AI that is consultative, online trained, and adapted to the user's common use cases. The asymptote is emergent symbolic reasoning, and symbolic reasoning is serial computation that fits on a single core CPU. Game on, industry.
rafark 11mo ago
How many of those are actual active users though? I created my account when chatgpt 3.5 was launched because it was a novelty but haven’t used it in a long time. I use Claude and Gemini but I’m somehow counted in that 1 billion figure
iainctduncan 11mo ago
Hard disagree on the moat. I do tech diligence on "AI startups" regularly and so far have yet to hear of one that has had a hard time ensuring they can use competitors just as easily. Everyone is very aware of that issue, if blissfully ignorant of others.
- senordevnyc 11mo ago
  We’re talking about consumers using ChatGPT, not startups using the OpenAI API.
  - iainctduncan 11mo ago
    I really doubt they will ne different. In fact I would guess it's even easier for the to change.
thisisit 11mo ago
This reminds of ads on Amazon Echo and other intelligent devices. I think there was similar hype - not in terms of scale - but on personal data. Many advertisers and their moms were writing skills to tap this market. It'll be interesting to see how they serve up ads and how it ends up working. Before the initial state is that people will find ways to serve up malware in form of ads and someone might end up writing ublock type stuff to block these ads.
andy99 11mo ago
How would pivoting to advertising change OpenAI’s valuation? Isn’t it currently driven by leading the charge towards global upheaval through AGI? As opposed to becoming a google competitor? Seems like that warrants a different revenue multiple
adidoit 11mo ago
Yeah I think all of the concerns about ARPU and what the ROI from AI will be are not justified given the opportunity if executed well. LLMs contain high intent significant memory. Their usage is exploding. Getting $200 subscriptions from a small number of whales, $20 subscriptions from the average white-collar worker, and then supporting everything us through advertising seems like a solid revenue strategy
abustamam 11mo ago
My wife and I have android phones. Google pretty much shoves AI down our throats. She probably doesn't know what gemini is but I know she's been using it probably without realizing she's using AI. And she never uses ChatGPT. Not saying that that makes Gemini better or more popular than Open AI in any way. But it just goes to show that more tech-normies use Gemini than you think.
- mk89 11mo ago
  I just had to fix the phone from a family member that used to shut it down by pressing and holding one of the side buttons, and now got instead an "ask gemini" pop-up. It must be some "upgrade" I guess?
  - abustamam 11mo ago
    They replaced Google Assistant with Gemini; it was opt-in for a minute but I guess they decided to turn it on for everyone. I think at some point the default action for long pressing the power button turned into summoning it. I personally opted in, so I didn't notice when they completely axed assistant, but it was stupid that I had to turn my power button back into a... Yknow, power button. I don't need an AI button on my phone, and I can't imagine most people do.
joshuahedlund 11mo ago
> most normal people don't know what Claude or Gemini are “Google Gemini” is the No 2 ranked app in the Apple App Store (behind ChatGTP) and has been for some time
sfifs 11mo ago
If there's one thing the history of mass internet servuces teaches us, it is that people switch to platforms with superior product/experience in an instant. Remember Lycos, Yahoo, & Hotmail? They all had strong userbases for their time who switched in an instant to Google Search & Gmail. Even with network effects, it is very difficult to compete without outright superiority - remember Orkut, MySpace, Google Plus or even Facebook? Meta made the right decision buying Instagram and WhatsApp instead of trying to sustain Facebook. There are no lock-ins in Chat assistants at all and no network effects. All evidence suggests now cutting edge high performance models are mostly coming out of Google, Anthropic etc and high efficiency models are coming out of China. ChatGPT also appears to have a disadvantage in the talent war - mostly because talent seems to not like to work with the management. Also almost no one I know uses ChatGPT now as their primary AI assistant now because they feel the quality of answers from others are simply superior (I check case by case) and the same seems to hold in more formal tests in AI enabled product development. Even Microsoft has started hedging bets with Anthropic. OpenAI really really needs to focus on outright superiority or it's going to be interesting to see how the financial shakeout is going to play.
- doctorpangloss 11mo ago
  Nah, people using Yahoo are still using it today. What happened was the growth of new users of the Internet in general was so massive, T+1 cohort’s early adopters outnumbered T cohort’s majority. the better product won, it’s just that the friction of switching didn’t matter. Switchers didn’t matter.
  - the_pwner224 11mo ago
    On one hand, true, my mom still uses Yahoo. But email has a strong network effect - you need to update everyone & every service who has your @yahoo address. Switching does happen there are no network effects. Nobody uses Mapquest or Ask Jeeves.
    - doctorpangloss 11mo ago
      Haha so many people were using Mapquest it was acquired in 2019
gmadsen 11mo ago
The memories are the moat. Regardless of the current or future capability, most users already view chatgpt as a personal confidant that they are investing energy into building a relationship with. That will be a far stronger moat than anything else
- itopaloglu83 11mo ago
  I’ve had a couple of instances where when I describe a requirement, ChatGPT would not list an open source project like n8n and happen to only remember paid alternatives. It’s an advertiser’s wet dream, being able to slowly creep and manipulate even the most uninterested people into using a product. And it’s so personalized that ChatGPT may even refuse to tell you about products that are not paying them a cut and this can put out a company entirely out of business, because unlike search engines, the customer might not even learn about your product despite directly asking for it.
  - 0xDEAFBEAD 11mo ago
    Pretty sure FTC rules force bloggers to disclose if they're being paid to promote a product. Maybe someone will be able to make a lot of money suing OpenAI if they violate those rules.
    - itopaloglu83 11mo ago
      I hope so, because a similar thing is happening with dynamic pricing at grocery stores and nothing is being done yet. We’re about to be charged whatever we could afford to pay for a product. Thanks Kroger.
      - itopaloglu83 11mo ago
        Dynamic pricing at grocery stores really concerns me. Hiking up the price of an item because you have to buy it now for whatever reason. Kroger couldn’t even imagine how bad the locked cart wheels could get, there’s no way they can control the pushback elegantly. Oh, you need milk now because your baby is crying, let me jack up the price. I can easily see people getting violent at grocery stores.
jalapenos 11mo ago
Absolutely, would be insane if they didn't monetize free tier with ads. And this is a good progression. Google search results were just turning to garbage. Facebook was just a slurry of noise. ChatGPT is actually helpful and useful.
- brikym 11mo ago
  Google abused their users and customers with intentionally useless results. The more useless the results are the more time users would spend coming back again to search, and the more need there is for businesses to buy ads just to be seen.
neya 11mo ago
I'm ok with having ads for free users, many of us saw this coming. What I'm really afraid of and knowing how this industry works, AI advising/gaslighting users into buying useless stuff in the guise of advice is NOT ok. Imagine you ask ChatGPT about coffee beans and it goes into insane detail about finding the right coffee bean and then it slips in a "btw, here's a couple of good coffee bean brands: A, B, C..." That's super scary since your trust factor with the AI is really high and it already knows it and is actively exploiting it. I would imagine even paid users might be subject to this without them ever knowing/finding out. This is why open-weight open-source models are extremely important.
rtpg 11mo ago
they're going to compete on ad unit economics against a company whose entire bread and butter has been selling ads. All while increasing unit costs to provide their service (like all the AI companies seem to be doing by just having more and more planning layers) If ChatGPT went away tomorrow everyone who wanted to would be fine just moving to one of the other random chatbots from one of the other providers. ChatGPT is the default name that people know, but I don't think that's the same as a moat. A moat would allow OpenAI to go really hard on pricing and ads, and I don't think they have that margin!
overgard 11mo ago
Sam has a pattern of, uh, not being exactly honest
1vuio0pswjnm7 11mo ago
Snapchat is nearing 1 billion monthly users. Why can't it turn a profit? https://www.latimes.com/business/story/2025-11-26/snapchat-snap-billion-monthly-users-social-media-facebook-evan-spiegel https://www.latimes.com/business/story/2025-11-26/snapchat-s...
knowriju 11mo ago
Would be quite hilarious if the first two companies to buy As space on ChatGPT is Anthropic and Google. Specially hilarious, since that's exactly how TikTok got all their initial traction from Meta Ads.
- 0xDEAFBEAD 11mo ago
  "Hey ChatGPT, these ads are annoying, how do I get rid of them?" "Here's a reply from our sponsor Anthropic: [...]"
helsinkiandrew 11mo ago
> All free LLM chat apps will need to support ads or they will eventually die due That’s the issue OpenAI has: Gemini is “free” with google search and other google services. If Apple get their act together they can provide a “privacy respecting” AI free with every iPhone. I’ve recently switched from OpenAI as my daily ‘helper’ chatbot to Gemini (I’ve done it with Claude in the past and still use that for coding) and don’t miss ChatGPT. Sure each has quirks and one will release a new version and it becomes the best LLM briefly but to the majority of public and businesses they are interchangeable and the winner is the one that can deliver the functionality for free (because it’s paid for by another service) or into an existing product.
- aurareturn 11mo ago
  I think OpenAI is well aware of this. I think that's why they're making their own browser, hired Jony Ives to make their physical device, etc.
dzjkb 11mo ago
not sure I'd trust what Sam Altman publicly says in this regard, here's a rather different picture: https://www.wheresyoured.at/oai_docs https://www.wheresyoured.at/oai_docs
ForHackernews 11mo ago
Matt Levine once wrote about OpenAI's business model: ------------------------------------ There’s a famous Sam Altman interview from 2019 in which he explained OpenAI’s revenue model [1] : > The honest answer is we have no idea. We have never made any revenue. We have no current plans to make revenue. We have no idea how we may one day generate revenue. We have made a soft promise to investors that once we’ve built this sort of generally intelligent system, basically, we will ask it to figure out a way to generate an investment return for you. [audience laughter] It sounds like an episode of Silicon Valley, it really does, I get it. You can laugh, it’s all right. But it is what I actually believe is going to happen. It really is the greatest business plan in the history of capitalism: “We will create God and then ask it for money.” Perfect in its simplicity. As a connoisseur of financial shenanigans, I of course have my own hopes for what the artificial superintelligence will come up with. “I know what every stock price will be tomorrow, so let’s get to day-trading,” would be a good one. “I can tell people what stocks to buy, so let’s get to pump-and-dumping.” “I can destroy any company, so let’s get to short selling.” “I know what every corporate executive is thinking about, so let’s get to insider trading.” That sort of thing. As a matter of science fiction it seems pretty trivial for an omniscient superintelligence to find cool ways make money. “Charge retail customers $20 per month to access the superintelligence,” what, no, obviously that’s not the answer. ------------------------------------ I agree with the sibling commenter that this move is a sign of OpenAI's weakness. If you really believe you have a superintelligent machine-god (or will have one soon) then "run ads when people talk to it" is not the business model you pick.
- aurareturn 11mo ago
  I'm almost certain that OpenAI employees used ChatGPT to come up with ideas on how to monetize itself. So his statement most likely came true? Note that the second paragraph about god was the author's opinion. It seems like Matt Levine was wrong to make fun of Altman here.
knallfrosch 11mo ago
ChatGPT has zero moat. Negative, really. They own zero hardware or software stacks. Their AI just got wiped by Google. Unknown Chinese companies release free models that are mere weeks behind them. Apple can restrict the ChatGPT app on iOS to not sext with users. What's Altman going to do? Cry in a corner?
techblueberry 11mo ago
“Extremely personal data on users” Is this data actionable though? Google has way more marketable data on me as I search YouTube for my hobbies and other interests. My LLM could probably sell me philosophy books? The amount of marketable stuff I provide it is minimal, and even the things that are marketable I’m unlikely to click on.
toddmorey 11mo ago
Everything in tech becomes ad-supported bullshit even if you pay for it. Tech knows no other business model with consumers besides devaluing the product to grow large enough to be another shitty ad platform.
everdev 11mo ago
They spend $3 for every $1 they make, so they're just living off of investors and government contracts at this point. Their revenue is basically a moot point.
martin82 11mo ago
Why should ads be a moat??? People hate ads. I have changed from ChatGPT to Grok and have felt absolutely no difference in my usage patterns, just getting better answers. Every competitor has cloned ChatGPTs UI/UX and API, so hopping between competitors is a no-brainer. There is no moat.
vandal8ind 11mo ago
[dead]

Andrex 11mo ago

Spinning up an all-new ad network is pretty tough. I would think OpenAI would need to beat Meta/Google on basics like CPM in order for the network effects to make it desirable for ad vendors over Meta/Google. Ad budgets are fixed and zero-sum and vendors (in my head, I don't know) would prefer to spend their money on the best network giving the best results. I don't know if ads in LLM chats can get there.

rs186 11mo ago
If Apple can build an ad system within the app store, I don't see why OpenAI can't do that for ChatGPT.
- chroma205 11mo ago
  > If Apple can build an ad system within the app store, I don't see why OpenAI can't do that for ChatGPT. Because Apple iPhone users have no alternative. But Google Gemini is right there for Gmail, Google Docs, and Google Workspace users.
kavrick 11mo ago
Microsoft owns a big chunk of them and already has a big network. Why not just use theirs?
- rs186 11mo ago
  Why would OpenAI want to use and pay for any of Microsoft's products unless mandated by a contract? OpenAI has the talent to roll out and run their own ad product that is better and more efficient. Why pay Microsoft for a core part of their (future) business? P.S. In case you haven't noticed, OpenAI demos are done on Macbooks. Microsoft could not even get them to use Windows.
  - CharlieDigital 11mo ago
    Microsoft runs many of their demos on MacBooks. You missed the memo that Windows OS is no longer their bread and butter. Go check their GH OSS projects (e.g. .NET) and all of them have have shell scripts alongside PowerShell.
aurareturn 11mo ago
I'm betting that they can. Here's an idea that just popped into my head: ChatGPT shows a sponsored entry in chat history list with a colorful border around it to get users to click. This product is something that ChatGPT knows the user desperately needs from previous chats. The user can chat directly with the product and learn more about it. The advertiser specifically sent OpenAI information (like a RAG) about their products buyers might have questions for. When the user is ready, they can open a link to the product's website or just buy directly in ChatGPT.
- nerdponx 11mo ago
  They can also suggest chat topics. Like how Reddit ads are meant to look like threads. "Frustrated with food baked on dishes? Let's chat about it! (sponsored)"
- mattlondon 11mo ago
  But the missing part is "we know they need this!" but they don't have the ad network to have the pixels on the vendor sites to track the conversion (or not for remarketing!). They only have half (at most) of the picture. This is why they tried to create a browser (remember that? Nope me neither) to try and get the full picture. Advertisers are accustomed to pay for conversions now. If you can't track it, you cant prove it happened. Open ai will need to spin up the entire infrastructure (Inc sales teams, support teams, servers etc) to run the ad network. Not impossible but it is a big lift and they're already burning money. Their best bet is probably to just sign up for selling their ad space with Google, like all the other apps and websites do
  - DrewADesign 11mo ago
    I think the amount of money they’re burning on their operations would make that organizational lift a drop in the bucket. A few dozen annual 6 figure salaries? A few hundred? A bunch of normal CPU-based AWS services? They must spend 10 million per day on their current operating expenses.
    - mattlondon 11mo ago
dktp 11mo ago
Spotify, Netflix, Amazon Prime, Reddit, Twitter etc all have increasingly profitable ads I'm sure llm providers will also figure it out in due time. Consumer products are generally a good fit for ads, even if it takes time to reach full potential
- raw_anon_1111 11mo ago
  Every single one of those companies have ridiculously low marginal cost per request compared to ChatGPT and much lower fixed costs and continued development costs.
fweimer 11mo ago
I thought that most advertisers go through middlemen and do not do business with the ad networks directly? So you only have to make it attractive for the middlemen (of which there are fewer), and that shouldn't be a problem for anything AI-related. Furthermore, anyone offering some sort of assisted browsing service is automatically in the ad business, regardless what they do with affiliate links in generated page summaries.
- mcny 11mo ago
  Oh yeah and on top of that these companies like WPP hate the fact that Google and Facebook refuse to share more information with them. They can't wait to jump ship.
rco8786 11mo ago
They have all the resources anyone could possibly need to do this, including an enormous list of companies who would kill to get their products into ChatGPT. It’s “just” an execution challenge.
dylan604 11mo ago
Why would they need to beat Meta/Google, and at what game? They just won’t let any other add network work in their app. Voila! You just beat Meta/Google, and they didn’t even compete with them. I guess they could provide some sort of SDK for websites to embed that tracks users, or they could come up with a browser extension that tracks users too. They already have an app that people are freely giving them so much info. Where else could the compete as you suggest? Being a generic ad platform to serve ads not through their app?
jpalomaki 11mo ago
If OpenAI manages to get the agentic buying going, that could be big. They could tie the ad bidding to the user actually making the purchase, instead of just paying for clicks.
dolphinscorpion 11mo ago
They have enough money for it, and they hire former Google and FB execs. As long as they have eyeballs, it will work.
delaminator 11mo ago
Is it harder than spinning up a multi billion dollar data centre network with other people’s money? Partner branding would be a mechanism to get the ball rolling - and some are big names. Oracle, Shutterstock, BuzzFeed, Bain & Company, Salesforce, Atlassian, Neo, Consensus,

Xenoamorphous 11mo ago

I agree 100% with you. In this niche forum people keep saying “there’s no moat”. But the moat is the brand recognition, if I ask my 70yo mum “have you heard of Gemini/Claude” she’ll reply “the what?”, yet she knows of ChatGPT. Does Coca Cola have a moat? Some company could raise $1B to create a new cola beverage that beats Coca Cola in all blind tests imaginable yet people will keep buying Coca Cola. Did people switch search engines or social networks when Google or FB introduced ads?

dkdcio 11mo ago
I don’t disagree but want to go on the record predicting this will collapse on itself spectacularly and OpenAI will still “fail” commercially for the Cola Cola drinkers, the product goes from an infallible AI to with no ulterior motives to another Google that’s purpose is to sell you ads, but more creepily. it’s like if Coca Cola started adding a few milliliters of bleach to their product
- tensegrist 11mo ago
  normal people don't have the same expectations as you when it comes to how much a given service should know about them, is the thing "how did X know whose profile you saw on Y service" "the computer knows everything i do on the computer, what do you mean"
  - jon-wood 11mo ago
    This isn’t backed by the constant conspiracy theories about voice assistants listening to everything you say and then farming that off to third party ad providers so that you see ads for things you’ve been discussing.
    - solumunus 11mo ago
      People moan about that but it doesn’t change their consumer habits at all.

iLoveOncall 11mo ago

Trust in LLMs is easily broken, and many users are starting to see the cracks. Once those AI companies start rolling out ads inserted in the answers, the quality will go down even more, and they will burn the last good will of the people. There is no moat because their only way to make money is to self-destruct. Talking on a more practical POV, your cost to display the ads needs to be lower than what companies pay you for advertising. And while companies might be willing to pay a small premium for "better" targeting because the LLM supposedly has more personal data about users, the cost to deliver those ads (generating answers via LLMs) is several orders of magnitude higher than for traditional ads served on websites. So even sticking to a purely technical aspect, ads might simply not be profitable when integrated in LLM answers. Combine the two aspects, and OpenAI is all but a dead company.

fn-mote 11mo ago
> ads might simply not be profitable when integrated in LLM answers. This is wishful thinking. Companies are using LLMs for development. The ads are not for a $50 throw pillow, they are for a $10k monthly business-critical service. Consumers might not be worth advertising to (although I doubt it), but B2B ads - absolutely.
- delaminator 11mo ago
  If there is a $10k monthly business critical service, are ChatGPT ads going to sway you?

lenkite 11mo ago

Only a short matter of time before agentic tools start serving ads too - paying user or not. You want to refactor your codebase ? No issue - taking 30 seconds - please view this ad meanwhile.

nerdponx 11mo ago
Extra convenient because people are already used to these things taking several seconds to respond.
mmoll 11mo ago
You won’t just be viewing an ad, you will have to actively engage in a minute long sales talk with the LLM.
- placatedmayhem 11mo ago
  In my head, it'll be like the high pressure timeshare sales pitches or the dreaded car sales transactions, where they pull out all the tricks to convince you to buy something you don't actually want or need, regardless of whether you can afford it.
  - simianparrot 11mo ago
    “That’s a great point about your finances. But did you know this company offers credit to someone in your position for only this low interest? I can apply on your behalf if you just sign this statement”
- teeray 11mo ago
  “We’ll finish up your feature soon. In the meantime, have you considered a timeshare in Vegas?”
- jijijijij 11mo ago
  The code will come out just fine, so your atrophied brain will remain dependent on OliCorp's parasocial prosthesis for strenuous thinking, dissolving wariness in experiences of super productivity. Then elsewhere, when plausible, OliCorp will progressively nudge you in some direction sold as predefined weight bonus to third party customers. You won't even notice and really, isn't it a fair price for all that productivity? Of course, AI isn't always right yet, but I'd say in a very practical 95% of cases your goals and expectations are in alignment with OliCorp AI. Don't forget, every website and service monetized automated access as a consequence of the AI scraping boom and made unauthorized web-indexing impossible, traditional search dried off. And when OliCorp finally turned off access to their legacy index monopoly in favor of AI interfacing, you really have no choice but to trust your friendly chat buddy. Who else are you gonna ask for the fix? Former friends, your family or neighbors? People you've grown to hate because sympathetic local clustering is discouraged through four color divisive information shaping. I mean, those guys really are at fault for your lack of self-efficacy, the hate is warranted. And you're too tired to bother anyway.

the_real_cher 11mo ago

People talk about LLMs and chatGPT in the same breath. Just like how people used to say 'google it' They now say 'look it up on chatGPT'. They have the cultural mind share which is more important than anything.

mattlondon 11mo ago
I ask people this. In the UK at least it seems like chatgpt is not so pervasive to the folks I talk to. "Oh that AI mode on Google search?" is potentially more common from "average" people. I hear that it is very popular in schools though as everyone is always looking for the best way to cheat and ChatGPT got viral that way earlier. Not sure being "the cheating app" is a great look though? Advertisers are very sensitive to the surfaces they are displayed on - do they want to appear in the app being used primarily to cheat on homework?

logifail 11mo ago

> 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 Given one can (at least for the moment) export one's entire chat history from ChatGPT, what exactly would stop a ChatGPT user from switching to an alternative if the alternative is either better, or better value?

android521 11mo ago
The answer is friction. What % of this billion of users will bother to export their chat history (which is already a lot) and import another another llm. That number is too small to matter.
- adam_patarino 11mo ago
  Since each chat is virtually independent there’s no switching cost. I’ve moved between Claude and ChatGPT with no cares. It’s not like Facebook where all my friends stay behind
  - aranelsurion 11mo ago
    > Since each chat is virtually independent That hasn't been true for a while though. Open a new chat tab in ChatGPT and ask it "What do you know about me" to see it in action.
    - downsplat 11mo ago
      You can turn that off. If you're using LLMs for technical or real world questions, it's nicer for each chat to be a blank slate.
      - aranelsurion 11mo ago
        You can also use Temporary Chats for that.
- swexbe 11mo ago

storus 11mo ago

They can easily LoRA-finetune each model based on user preferences expressed in the past conversations. That would improve accuracy compared to Google's ad targeting by orders of magnitude.

emsign 11mo ago

Yeah, ChatGPT is dead now.

chroma205 11mo ago
> Yeah, ChatGPT is dead now. Not dead yet. But definitely bleeding. CharGPT lost 15-20% market share to Gemini in second half of 2025.

Hamuko 11mo ago

>Sam just said OpenAI's revenue will finish at $20b this year. 6x growth from 2024. How much did their profit grow?

reeredfdfdf 11mo ago

"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." I'm not sure that really is the case. Most non-techies I know use ChatGPT far less than they use Google search, let alone various social media apps they're addicted to. Perhaps it is a threat to Google search, but I can't see how it's going to be threat to ad revenue from Meta, Youtube etc - the services that are actually addictive due to the content they serve. At least for me there's absolutely nothing addictive about ChatGPT. It's just a tool that helps me solve certain types of problems, not something I enjoy to use.

bpt3 11mo ago

What do they have that's more personalized than Google search history for the vast majority of users?

aurareturn 11mo ago
I've uploaded multiple medical reports of mine to ChatGPT over the last few years. ChatGPT knows more about my medical than my doctor.
- bpt3 11mo ago
  Most people do effectively the same with Google searches.

afavour 11mo ago

> most normal people don't know what Claude or Gemini are In think the point is that they don’t need to know what Gemini is, they just need to know Google, which they most definitely do. IMO ads rollout won’t be as simple as you’re describing it. A lot of people have switched from Google search to AI specifically because it isn’t filled with SEO, ad filled nonsense. So they’ll need to tread very, very carefully to introduce it without alienating customers. Not to mention mollifying advertisers who are nervous what their product will be shown alongside and OpenAI will probably struggle to offer iron clad guarantees about it. And people generally speaking don’t like ads. If competitors like Google are able to hold out longer with no ads (they certainly aren’t wanting for ad display surfaces) they might be able to pull users away from OpenAI. IMO pivoting to ads is a sign of core weakness for OpenAI. Anyone trying to set up their own ad network in 2025 has to reckon with Google and Meta, the two absolute behemoths of online ads. And both also happen to be major competitors of OpenAI. If they need ads that’s a problem.

falcor84 11mo ago
Yeah, I saw several people who only first tried AI chats on Google's new "AI Mode", which uses Gemini, but doesn't mention it anywhere.
- lxgr 11mo ago
  Even “AI mode” isn’t mainstream yet, at least in my observation. “AI summaries” are, but they seem to be powered by an even weaker model.
- A4ET8a8uTh0_v2 11mo ago
  I am not exactly a great example ( exposure to work model, ollama, local models play ) and I actually liked gemini upon try in google search ( which is amusingly now banned at work ), but the nice quickly fell into not nice, when it started giving me weird pushback on operation paperclip book ( I am assuming chapter discussing tabun triggered something. This is my only real problem with gemini. By comparison, I am not running into guardrails with gpt nearly as often.
11mo ago

isodev 11mo ago

> - Extremely personal data on users - Novel way of introducing and learning more about sponsored products Doesn’t anyone think this is really, really bad idea? We managed to radicalise people into the rise and fall of entire countries through analog ads, can you imagine how devastating it would be to infuse every digital product with all that?

tomaskafka 11mo ago
That’s how I read it, I’m surprised it would be meant as a positive (except for investors)
aurareturn 11mo ago
No, I don't think it's really bad. Most of the world doesn't care. Only in a small tech niche on the internet do they care a lot.
- isodev 11mo ago
  Are you sure? Because most of the world also doesn’t know how “this cloud thing” works… I think we need global, EU style consumer and data protection constraints before stepping into LLM-powered ads through personal assistants.
- LastTrain 11mo ago
  I just got back from Thanksgiving holiday with my family. Grade schools kids all the way up to great grandparents up to 81 years old. Engineers, active military, a nurse, high schoolers, two in college. Both coasts represented and Texas. Republicans, Democrats, and in-between. The one and only thing every single person had in common was an utter hatred of AI. And it wasn’t for a lack of understanding of how it will be used.
  - fn-mote 11mo ago
    Hatred of AI won’t stop others from steamrolling them and their jobs using AI. At this point, I have stopped hoping that LLMs will become vaporware.

materielle 11mo ago

I think investors would certainly love this. So why hasn’t it already happened? 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.

lazide 11mo ago
Aka you need them deep enough into the trap they can’t escape, before you trigger it.
- smallmancontrov 11mo ago
  Yes and there are layers. Remember when google ads had yellow backgrounds? I'm sure OpenAI will find a way to do ads "ethically"... for a while, until people get comfortable, and that's when they will start to make ChatGPT increasingly manipulative.
  - lazide 11mo ago
    Gotta make that line go up and to the right!
    - smallmancontrov 11mo ago
      > The goals of the advertising business model do not always correspond to providing quality search to users. - Sergey Brin and Lawrence Page, The Anatomy of a Large-Scale Hypertextual Web Search Engine
- SketchySeaBeast 11mo ago

mejutoco 11mo ago

I do not understand why the conversation is always about showing ads in chatgpt. Can they not track users there without ads and sell ad space on websites like google ads? Why ruin the experience there when they can highly target ads. I am guessing they prefer both.

jsnell 11mo ago
There is nowhere near enough money in the ad network business. Like, Google's search ad business is an order of magnitude higher than the ad network, and the ad network has been shrinking in absolute terms for years while the first party revenue has been growing at double digits.
A4ET8a8uTh0_v2 11mo ago
Eh, so.. I don't know if I was in some weird A/B testing group, but I saw lazy reference to real estate ( zillow ) in my chat few weeks ago, which was .. I had to think of a way in how 'not close' it was to our conversations. And the issue is clearly not that it can't profile me. It absolutely can. And I sometimes ask for some explicit shopping comparisons. But what do I get, real estate ad..lazy. Lazy and uninfuckingspired.

faithlv 11mo ago

Clammy Sam says all sorts of shit, his word has little value.

__MatrixMan__ 11mo ago

It seems like you could make a sort of seive out of multiple free models such they each remove each other's ads.

A4ET8a8uTh0_v2 11mo ago

I think the real question is: what are you doing to make it less painful? Full disclosure, chatgpt has a lot on me, but I am using to this time to prep nice local build. It has gotten really nice and current crop of machines with ai395 got really nice ( I almost wrote a short page over how easy it was compared to only few years back ).

ori_b 11mo ago

And the ads can be blended seamlessly into generated content. "You can do this in Postgres, but the throughput will be limited. Consider using hosted clickhouse instead. Would you like me to migrate your project?"

dangus 11mo ago

You are 100% correct, and I don’t mean to refute your comment by saying this: For me personally, the moment AI has ads, I’m out. I’ve drawn this line with search engines as well. I now pay for a no-ads search engine. But for AI, I think I’d rather buy some hardware or use my existing desktop PC and run something local with search engine integration. I know this won’t be a popular option but I think this time around I’ll just skip the ensgittification phase and go straight to the inevitable self-hosting phase.

Workaccount2 11mo ago
They will certainly offer privacy focused ad-free models. Enterprise demands it. However you will have to pay the full true cost of each token. Not the promo pricing like we have now or the ad-subsidized plans that will be offered.
fn-mote 11mo ago
> the moment AI has ads, I’m out HN users run adblockers. The usual estimate is that people who run adblockers are with $0, so don’t worry about them. Now — normal people did not used to run adblockers, although in my circles (young demographic) that has changed more than I expected.
shinycode 11mo ago
I second that, trust is broken if there is ads. The line of great ads to weird ads to pushy-borderline-scam ads into personal context is thin. Hopefully the price of local will go down and maybe apple will be able to push most of it on-device. The day chatGPT push ads in a conversation I stop using it. The thing is with llm, it went so fast to get that many users, it means people are used to adopt new stuff as well. With proper marketing and specific feature I won’t be surprised to see people switch service as easily they start using it in the first place because the barrier is so low.

micromacrofoot 11mo ago

the moat is always ad networks in the end... open ai figured out a new way to accumulate users to show ads to

tarsinge 11mo ago

I’m actually one of the people that continue to say even with this list they have no moat, because Google, Facebook, Microsoft, etc. can just embed a chatbot in their existing products or social network and make ChatGPT irrelevant overnight. Non tech users will chat through their browser, OS, Apps, website, that’ll be served by any model provider. The only moat of OpenAI is investor money to burn so that they can offer it for free. Also 20 billions of revenues, not profits, is orders of magnitude too low compared to their expenses. Their only path to survival is a massively downgraded free tier ridden with ads. Nobody will use an app like this when they can have a better more integrated experience directly in their other apps.

NewsaHackO 11mo ago
What do you mean the can? All of those services have already done this, but they have not slowed ChatGPT down.
marcosdumay 11mo ago
> Also 20 billions of revenues, not profits, is orders of magnitude too low compared to their expenses. Nah, it's just one order of magnitude... Also, they expect revenue to grow exponentially so it's 20 billions annualized by the end of the year. Last time I saw somebody talk about it, it was about half of it, and trending down. Anyway, if they manage to take ~20% of the ads revenue from Google, they will be able to cover ongoing depreciation! That's the amount of money they need.
- ViewTrick1002 11mo ago
  The problem is that inference is a whole different ballgame in terms of costs compared to a traditional SaaS model where each extra customer adds near zero in cost. They may make it work but OpenAI is more akin to a traditional high revenue low profit business like for example a grocery store. Thats why we are seeing the explosion of extra tools to try lock in business for higher value use cases and not fight on the margin.
  - delaminator 11mo ago

insane_dreamer 11mo ago

> (most normal people don't know what Claude or Gemini are) They just use Google, with "AI Overview" at the top. Google's in a strong position still. Claude, I agree. IMO that's why Anthropic is so heavily focused on coding and agentic tasks -- that is its best option (and luckily, not ad-based)

lm28469 11mo ago

The problem is that going for ads basically is an admission that AGI is nowhere close to what they pretend. People are valuating it for "skynet is around the corner" not "we're going to kill our product by polluting our answers and inserting ads everywhere"

emp17344 11mo ago
Hopefully this is the point where AI starts to be seen as just a useful tool, as opposed to a sign of imminent AGI. I’ll be glad to hear less rabidly overzealous rhetoric surrounding AI.

aranelsurion 11mo ago

Also ads in LLM can be perfectly merged with the content, it'd be impossible to know if LLM tells you something because that's the most likely useful answer or the most profitable one for its owners. Can't be just ad-blocked either, it might be the ultimate channel for ads. > how strong of a moat there actually is for ChatGPT. None of the above requires OpenAI to be around though. Google, Apple and Microsoft each have much stronger brands, and more importantly they each own large platforms with captive audiences where they can inject their AI before anyone else's and have deeper pockets to subsidize its use if need be. Everywhere OpenAI opens up shop (except for Web) they're in someone else's backyard.

logicallee 11mo ago
it could just have a section called - Ad - And include an ad section within the text. Alternatively, if it tells you something because that company is a sponsor, it could just include an appropriate disclaimer.
jcfrei 11mo ago
"Using chatgpt" is now synonymous with talking to an AI. I wouldnt underestimate their brand recognition and moat.

raw_anon_1111 11mo ago

It’s an entirely different skillset to create technology $x than it is to create a successful ad network. Yahoo is the canonical example. It has been one of the most trafficked websites in the world through most of its history and still wasn’t able to successfully sell ads after the dot com bust. ChatGPT’s revenue means nothing if reports are to be believed that it loses money on each paying customer on just inference. It’s definitely not enough to support its training costs. Also, I think I remember estimates that it costs 10x as much to serve a ChatGPT result than it does for Google to serve a search result. Not to mention that Google uses its own hardware including TPUs.

aurareturn 11mo ago
ChatGPT’s revenue means nothing if reports are to be believed that it loses money on each paying customer on just inference. It’s definitely not enough to support its training costs. Sam Altman: We're very profitable on inference. https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Subscribe,2025%20at%2012:53%20am https://simonwillison.net/2025/Aug/17/sam-altman/#:~:text=Su... Independent analysis: Inference is very profitable. https://martinalderson.com/posts/are-openai-and-anthropic-really-losing-money-on-inference/ https://martinalderson.com/posts/are-openai-and-anthropic-re... https://www.snellman.net/blog/archive/2025-06-02-llms-are-cheap/ https://www.snellman.net/blog/archive/2025-06-02-llms-are-ch...
- raw_anon_1111 11mo ago
  Fair enough, I haven’t updated my assumptions in quite a while.

Rebuff5007 11mo ago

I think the good news is that open-source models are a genuine counterweight to these closed-source models. The moment ads become egregious, I expect to see and use services for an affordable "private GPT on demand, fine-tuned as you want it" So instead of a single everything-llm, i will have a few cheaper subscriptions to a coding llm, a life planning llm (recipes, and some travel advice?). Probably it.

qwertox 11mo ago

> This is why Meta and Google went all in on AI. Google, Microsoft, Meta and Amazon, among others, would have zero issues in ensuring that OpenAI does not grab a market they own; it shouldn't be that hard to bring OpenAI into a position where they cannot recoup their investments, hence going bankrupt. The big players then would also have the benefit of having those very bright minds being on the market for them to grab. And it's not like OpenAI owns much relevant hardware. Let's see where we are in 3-4 years.

jcfrei 11mo ago
Microsoft is financially backstopping OpenAI - they are not a competitor.
- qwertox 11mo ago
  Microsoft is using them in order to be better positioned than other big players, and they succeeded, even if Google is now starting to catch up. They can withdraw their support when and how they see fit, own exclusive IP rights to OpenAI's models and the hardware is their own anyway. They only lack the researchers, but they'll then be on the market.

outside1234 11mo ago

Honestly, I switched to Gemini and really haven’t missed anything. My wife just makes a google search with her “prompt” and doesn’t use ChatGPT. There might be a moat, but there are also extremely well funded competitors that make this moat a lot smaller.

an0malous 11mo ago

Sam is a habitual liar so I wouldn’t take anything he says seriously. LLMs are a commodity, once they put in ads people will increasingly move to the other options. It works for Google because they have a moat, OpenAI does not. There’s a reason they didn’t do this earlier. It’s going to piss people off and they’ll lose a lot of users.

grafmax 11mo ago

Tried and true Silicon Valley strategy: burn VC money to build a moat, wait until switching costs are high enough, and then enshittify the product to extract rent. Dont forget to call it progress.

cmckn 11mo ago

I think ChatGPT’s moat is mostly “it’s the first AI thing I used/heard about”. It’s not clear to me that’s enough to maintain their market share if OpenAI is the only one mixing in ads. It does seem to work elsewhere, though; consumers have brand loyalty to a fault, and often for the brand they started with.

fragmede 11mo ago
The question is how many users have developed intimate personal relationships and have named their ChatGPT, and how many of them would bounce to a different provider if some line is crossed (of which advertising could be one)? Anecdata isn't data, but I know several individuals who have and thus are even more unlikely to churn than mere brand loyalty on the level of eg Coca-Cola.
- ares623 11mo ago
  I’m curious how that intimate relationship evolves once ads are in play. Wait we don’t need to wonder. The chatgpt 5 rollout showed us exactly what happens when the intimate friend changes.
randyrand 11mo ago
That’s basically Google’s search moat too.
- zer0tonin 11mo ago
  No, Google was 10x better than any competitor until they started actively sabotaging their search product in the past 5 years or so. ChatGPT feels like an inferior product when compared to Claude or Qwen.

positron26 11mo ago

> 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. Game on. The systemic risk to the AI build-out happens when memory management techniques similar to gaming and training techniques that make them usable reduce the runtime memory footprints from gigabytes to megabytes, much of which fits in L2. When that happens, the data center will bleed back to the edges. Demand will find its way into private, small, local AI that is consultative, online trained, and adapted to the user's common use cases. The asymptote is emergent symbolic reasoning, and symbolic reasoning is serial computation that fits on a single core CPU. Game on, industry.

rafark 11mo ago

How many of those are actual active users though? I created my account when chatgpt 3.5 was launched because it was a novelty but haven’t used it in a long time. I use Claude and Gemini but I’m somehow counted in that 1 billion figure

iainctduncan 11mo ago

Hard disagree on the moat. I do tech diligence on "AI startups" regularly and so far have yet to hear of one that has had a hard time ensuring they can use competitors just as easily. Everyone is very aware of that issue, if blissfully ignorant of others.

senordevnyc 11mo ago
We’re talking about consumers using ChatGPT, not startups using the OpenAI API.
- iainctduncan 11mo ago
  I really doubt they will ne different. In fact I would guess it's even easier for the to change.

thisisit 11mo ago

This reminds of ads on Amazon Echo and other intelligent devices. I think there was similar hype - not in terms of scale - but on personal data. Many advertisers and their moms were writing skills to tap this market. It'll be interesting to see how they serve up ads and how it ends up working. Before the initial state is that people will find ways to serve up malware in form of ads and someone might end up writing ublock type stuff to block these ads.

andy99 11mo ago

How would pivoting to advertising change OpenAI’s valuation? Isn’t it currently driven by leading the charge towards global upheaval through AGI? As opposed to becoming a google competitor? Seems like that warrants a different revenue multiple

adidoit 11mo ago

Yeah I think all of the concerns about ARPU and what the ROI from AI will be are not justified given the opportunity if executed well. LLMs contain high intent significant memory. Their usage is exploding. Getting $200 subscriptions from a small number of whales, $20 subscriptions from the average white-collar worker, and then supporting everything us through advertising seems like a solid revenue strategy

abustamam 11mo ago

My wife and I have android phones. Google pretty much shoves AI down our throats. She probably doesn't know what gemini is but I know she's been using it probably without realizing she's using AI. And she never uses ChatGPT. Not saying that that makes Gemini better or more popular than Open AI in any way. But it just goes to show that more tech-normies use Gemini than you think.

mk89 11mo ago
I just had to fix the phone from a family member that used to shut it down by pressing and holding one of the side buttons, and now got instead an "ask gemini" pop-up. It must be some "upgrade" I guess?
- abustamam 11mo ago
  They replaced Google Assistant with Gemini; it was opt-in for a minute but I guess they decided to turn it on for everyone. I think at some point the default action for long pressing the power button turned into summoning it. I personally opted in, so I didn't notice when they completely axed assistant, but it was stupid that I had to turn my power button back into a... Yknow, power button. I don't need an AI button on my phone, and I can't imagine most people do.

joshuahedlund 11mo ago

> most normal people don't know what Claude or Gemini are “Google Gemini” is the No 2 ranked app in the Apple App Store (behind ChatGTP) and has been for some time

sfifs 11mo ago

If there's one thing the history of mass internet servuces teaches us, it is that people switch to platforms with superior product/experience in an instant. Remember Lycos, Yahoo, & Hotmail? They all had strong userbases for their time who switched in an instant to Google Search & Gmail. Even with network effects, it is very difficult to compete without outright superiority - remember Orkut, MySpace, Google Plus or even Facebook? Meta made the right decision buying Instagram and WhatsApp instead of trying to sustain Facebook. There are no lock-ins in Chat assistants at all and no network effects. All evidence suggests now cutting edge high performance models are mostly coming out of Google, Anthropic etc and high efficiency models are coming out of China. ChatGPT also appears to have a disadvantage in the talent war - mostly because talent seems to not like to work with the management. Also almost no one I know uses ChatGPT now as their primary AI assistant now because they feel the quality of answers from others are simply superior (I check case by case) and the same seems to hold in more formal tests in AI enabled product development. Even Microsoft has started hedging bets with Anthropic. OpenAI really really needs to focus on outright superiority or it's going to be interesting to see how the financial shakeout is going to play.

doctorpangloss 11mo ago
Nah, people using Yahoo are still using it today. What happened was the growth of new users of the Internet in general was so massive, T+1 cohort’s early adopters outnumbered T cohort’s majority. the better product won, it’s just that the friction of switching didn’t matter. Switchers didn’t matter.
- the_pwner224 11mo ago
  On one hand, true, my mom still uses Yahoo. But email has a strong network effect - you need to update everyone & every service who has your @yahoo address. Switching does happen there are no network effects. Nobody uses Mapquest or Ask Jeeves.
  - doctorpangloss 11mo ago
    Haha so many people were using Mapquest it was acquired in 2019

gmadsen 11mo ago

The memories are the moat. Regardless of the current or future capability, most users already view chatgpt as a personal confidant that they are investing energy into building a relationship with. That will be a far stronger moat than anything else

itopaloglu83 11mo ago
I’ve had a couple of instances where when I describe a requirement, ChatGPT would not list an open source project like n8n and happen to only remember paid alternatives. It’s an advertiser’s wet dream, being able to slowly creep and manipulate even the most uninterested people into using a product. And it’s so personalized that ChatGPT may even refuse to tell you about products that are not paying them a cut and this can put out a company entirely out of business, because unlike search engines, the customer might not even learn about your product despite directly asking for it.
- 0xDEAFBEAD 11mo ago
  Pretty sure FTC rules force bloggers to disclose if they're being paid to promote a product. Maybe someone will be able to make a lot of money suing OpenAI if they violate those rules.
  - itopaloglu83 11mo ago
    I hope so, because a similar thing is happening with dynamic pricing at grocery stores and nothing is being done yet. We’re about to be charged whatever we could afford to pay for a product. Thanks Kroger.
    - itopaloglu83 11mo ago
      Dynamic pricing at grocery stores really concerns me. Hiking up the price of an item because you have to buy it now for whatever reason. Kroger couldn’t even imagine how bad the locked cart wheels could get, there’s no way they can control the pushback elegantly. Oh, you need milk now because your baby is crying, let me jack up the price. I can easily see people getting violent at grocery stores.

jalapenos 11mo ago

Absolutely, would be insane if they didn't monetize free tier with ads. And this is a good progression. Google search results were just turning to garbage. Facebook was just a slurry of noise. ChatGPT is actually helpful and useful.

brikym 11mo ago
Google abused their users and customers with intentionally useless results. The more useless the results are the more time users would spend coming back again to search, and the more need there is for businesses to buy ads just to be seen.

neya 11mo ago

I'm ok with having ads for free users, many of us saw this coming. What I'm really afraid of and knowing how this industry works, AI advising/gaslighting users into buying useless stuff in the guise of advice is NOT ok. Imagine you ask ChatGPT about coffee beans and it goes into insane detail about finding the right coffee bean and then it slips in a "btw, here's a couple of good coffee bean brands: A, B, C..." That's super scary since your trust factor with the AI is really high and it already knows it and is actively exploiting it. I would imagine even paid users might be subject to this without them ever knowing/finding out. This is why open-weight open-source models are extremely important.

rtpg 11mo ago

they're going to compete on ad unit economics against a company whose entire bread and butter has been selling ads. All while increasing unit costs to provide their service (like all the AI companies seem to be doing by just having more and more planning layers) If ChatGPT went away tomorrow everyone who wanted to would be fine just moving to one of the other random chatbots from one of the other providers. ChatGPT is the default name that people know, but I don't think that's the same as a moat. A moat would allow OpenAI to go really hard on pricing and ads, and I don't think they have that margin!

overgard 11mo ago

Sam has a pattern of, uh, not being exactly honest

1vuio0pswjnm7 11mo ago

Snapchat is nearing 1 billion monthly users. Why can't it turn a profit? https://www.latimes.com/business/story/2025-11-26/snapchat-snap-billion-monthly-users-social-media-facebook-evan-spiegel https://www.latimes.com/business/story/2025-11-26/snapchat-s...

knowriju 11mo ago

Would be quite hilarious if the first two companies to buy As space on ChatGPT is Anthropic and Google. Specially hilarious, since that's exactly how TikTok got all their initial traction from Meta Ads.

0xDEAFBEAD 11mo ago
"Hey ChatGPT, these ads are annoying, how do I get rid of them?" "Here's a reply from our sponsor Anthropic: [...]"

helsinkiandrew 11mo ago

> All free LLM chat apps will need to support ads or they will eventually die due That’s the issue OpenAI has: Gemini is “free” with google search and other google services. If Apple get their act together they can provide a “privacy respecting” AI free with every iPhone. I’ve recently switched from OpenAI as my daily ‘helper’ chatbot to Gemini (I’ve done it with Claude in the past and still use that for coding) and don’t miss ChatGPT. Sure each has quirks and one will release a new version and it becomes the best LLM briefly but to the majority of public and businesses they are interchangeable and the winner is the one that can deliver the functionality for free (because it’s paid for by another service) or into an existing product.

aurareturn 11mo ago
I think OpenAI is well aware of this. I think that's why they're making their own browser, hired Jony Ives to make their physical device, etc.

dzjkb 11mo ago

not sure I'd trust what Sam Altman publicly says in this regard, here's a rather different picture: https://www.wheresyoured.at/oai_docs https://www.wheresyoured.at/oai_docs

ForHackernews 11mo ago

Matt Levine once wrote about OpenAI's business model: ------------------------------------ There’s a famous Sam Altman interview from 2019 in which he explained OpenAI’s revenue model [1] : > The honest answer is we have no idea. We have never made any revenue. We have no current plans to make revenue. We have no idea how we may one day generate revenue. We have made a soft promise to investors that once we’ve built this sort of generally intelligent system, basically, we will ask it to figure out a way to generate an investment return for you. [audience laughter] It sounds like an episode of Silicon Valley, it really does, I get it. You can laugh, it’s all right. But it is what I actually believe is going to happen. It really is the greatest business plan in the history of capitalism: “We will create God and then ask it for money.” Perfect in its simplicity. As a connoisseur of financial shenanigans, I of course have my own hopes for what the artificial superintelligence will come up with. “I know what every stock price will be tomorrow, so let’s get to day-trading,” would be a good one. “I can tell people what stocks to buy, so let’s get to pump-and-dumping.” “I can destroy any company, so let’s get to short selling.” “I know what every corporate executive is thinking about, so let’s get to insider trading.” That sort of thing. As a matter of science fiction it seems pretty trivial for an omniscient superintelligence to find cool ways make money. “Charge retail customers $20 per month to access the superintelligence,” what, no, obviously that’s not the answer. ------------------------------------ I agree with the sibling commenter that this move is a sign of OpenAI's weakness. If you really believe you have a superintelligent machine-god (or will have one soon) then "run ads when people talk to it" is not the business model you pick.

aurareturn 11mo ago
I'm almost certain that OpenAI employees used ChatGPT to come up with ideas on how to monetize itself. So his statement most likely came true? Note that the second paragraph about god was the author's opinion. It seems like Matt Levine was wrong to make fun of Altman here.

knallfrosch 11mo ago

ChatGPT has zero moat. Negative, really. They own zero hardware or software stacks. Their AI just got wiped by Google. Unknown Chinese companies release free models that are mere weeks behind them. Apple can restrict the ChatGPT app on iOS to not sext with users. What's Altman going to do? Cry in a corner?

techblueberry 11mo ago

“Extremely personal data on users” Is this data actionable though? Google has way more marketable data on me as I search YouTube for my hobbies and other interests. My LLM could probably sell me philosophy books? The amount of marketable stuff I provide it is minimal, and even the things that are marketable I’m unlikely to click on.

toddmorey 11mo ago

Everything in tech becomes ad-supported bullshit even if you pay for it. Tech knows no other business model with consumers besides devaluing the product to grow large enough to be another shitty ad platform.

everdev 11mo ago

They spend $3 for every $1 they make, so they're just living off of investors and government contracts at this point. Their revenue is basically a moot point.

martin82 11mo ago

Why should ads be a moat??? People hate ads. I have changed from ChatGPT to Grok and have felt absolutely no difference in my usage patterns, just getting better answers. Every competitor has cloned ChatGPTs UI/UX and API, so hopping between competitors is a no-brainer. There is no moat.

vandal8ind 11mo ago

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