Club Benefits
When Sam Altman, CEO of OpenAI, was asked about the likelihood of ChatGPT ever introducing adverts just one year ago, Altman said that he "hates ads" and described them as a "last resort"... well, that last resort has seemingly arrived.
The OpenAI team announced on Friday that it would begin testing adverts, limiting them to ChatGPT Free accounts, and the newly-announced ChatGPT Go (an $8 a month alternative).
These adverts seem to be a planned solution to the large number of free users that ChatGPT currently has, with Altman taking to X, saying: “It is clear to us that a lot of people want to use a lot of AI and don’t want to pay, so we are hopeful a business model like this can work.”
- Mission alignment: OpenAI’s pursuit of advertising is always in support of AGI and its benefits for all humanity
- Answer independence: Ads do not influence the answers ChatGPT gives you. They are optimized based on what’s most helpful to you.
- Conversation privacy: Conversations with ChatGPT are kept private from advertisers and no data will be sold
- Choice and control: You control how your data is used. You can turn off personalization and can clear the data used for ads.
- Long-term value: We do not optimize for time spent in ChatGPT. We prioritize user trust and user experience over revenue
These ads will be slowly rolled out to free plans, and they won’t show up every time. However, OpenAI has shared some screenshots, detailing how they might look. These examples include a link to hot sauce under a dinner party query and links to houses for rent when planning a trip.
Why is ChatGPT rolling out ads?
This is a fairly bold call from OpenAI. It will be the first of the major chatbots to launch adverts with its competitors all operating purely on subscription models and money from investments.
However, for ChatGPT, this move does make sense on paper. According to an OpenAI insider who spoke to the Financial Times, around 70% of the company's revenue comes from the roughly 5% of users who are on paid accounts.
That then leaves a gaping hole in the finances — a hole which could easily be plugged by introducing adverts. The ads would either cover costs directly or push free users into paying for an ad-free plan.
Will ChatGPT users jump ship?
Currently, ChatGPT is the only chatbot making this move. The best ChatGPT alternatives, including Gemini, Claude, Grok and Copilot all remain ad-free, even on the free versions of their platforms.
This offers a strange position for these platforms. Do they follow in ChatGPT’s footsteps, launching adverts for free users to soak up some extra funds, or do they hope that free ChatGPT users will jump ship at the sight of ad-funded platforms?
For the likes of Claude and Gemini, their AI systems remain profitable. Claude pulls a lot of its funding in from business with a far smaller side of its revenue coming from its consumers, and for Google, Gemini is only a small part of its business, acting more as a feature than an entire business model.
Sure, some other platforms like Grok, Meta or Copilot could make the switch, but we wouldn’t count on it. OpenAI is in a unique situation to benefit from adverts based purely on its enormous amount of free users.
Right now, the adverts being trialed seem fairly inconspicuous. They pop up only when there is a clear advertising sell, and are often clearly related to the product.
Right now, the adverts being trialed seem fairly inconspicuous. They pop up only when there is a clear advertising sell, and are often clearly related to the product.
The problem comes down the line. If OpenAI decides to rethink its advertising principles, adverts could become tailored to your conversations, ChatGPT’s memories of you, or intimate details that you would rather not receive adverts for.
In the announcement post for this news, OpenAI said: "During our test, we will not show ads in accounts where the user tells us or we predict that they are under 18, and ads are not eligible to appear near sensitive or regulated topics like health, mental health or politics."
It is not clear if this will always be the case, but the possibility has been left open-ended by OpenAI.
While this move makes a lot of sense for OpenAI, it will likely also push a number of users away from the platform, moving into the arms of one of the many other free chatbots on the market right now.
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