Executives said ads could have users ‘doubting everything.’
Executives said ads could have users ‘doubting everything.’
AI search startup Perplexity is distancing itself from ads amid fears users won’t trust chatbots with an agenda to upsell. The move highlights an emerging crossroads for the AI industry as the sector’s biggest players hunt for stable sources of income to bankroll massive spending, with giants like OpenAI leaning into ads and others like Anthropic promising to keep them out.
Perplexity began phasing out ads late last year and isn’t exploring any new ad deals at the moment, executives said on Monday at a roundtable event, according to Business Insider and the Financial Times. It is a noteworthy U-turn for the US startup, which became one of the first generative AI companies to test ads on its platform in 2024.
“The challenge with ads is that a user would just start doubting everything . . . which is why we don’t see it as a fruitful thing to focus on right now,” said an unnamed executive cited by the FT. Instead, the company will focus on producing something consumers are “willing to pay for,” in particular business customers and high-powered users like finance professionals, lawyers, doctors, and CEOs.
Another executive did not rule out a return to advertising in the future, but said serving ads was “misaligned with what the users want” and may not be needed for the company to thrive. “We are in the accuracy business, and the business is giving the truth, the right answers,” they said.
The pivot sets Perplexity firmly on the anti-ad side of the industry’s emerging divide over how AI should make money. Some, like Perplexity, are hoping subscriptions will be enough and Anthropic has committed to keeping its chatbot Claude ad-free. Others, like OpenAI, have embraced ads, and last week, the company started testing advertising for free ChatGPT users. The dispute has moved into the public arena as well, with Anthropic airing attack ads clearly targeting ChatGPT at the Super Bowl, which OpenAI CEO Sam Altman called “dishonest.”
