OpenAI and the complex ads situation

In case you haven't realised yet, training a chatbot like ChatGPT costs money. Big, big money. After raising a measly $6.6 billion in October, OpenAI are forced to start looking at alternative revenue streams.

First in line: advertising.

But ads are tricky

Advertising has been the revenue stream for internet companies since, well, the internet. From search engines to social media apps and even blogs, everyone be showin' ads and takin' cash.

Unfortunately, ads have also started to become the bane of everyone's existence on the World Wide Web. They're everywhere. They're invasive. They require collecting a bunch of personal data. Yuk.

This is very much on OpenAI CFO Sarah Friar's mind as they start eyeing ads as a potential revenue stream. "We want to be thoughtful about when and where we implement them," she told the Financial Times.

Indeed, adding contextual ads to ChatGPT could be a way to do it. But would that reduce ChatGPT's effectiveness? Or perhaps be seen as invasive by users?

"But the competition's doing it!"

Two OpenAI competitors have started experimenting with ads:

• Perplexity launched several ad features, including "Sponsored follow-up questions", sponsored products in contextual responses, and a merchant network.

• Microsoft launched an ads for chat API last year.

So, where does that leave OpenAI? It's clear they can't stay behind for much longer. Training their models isn't going to get any cheaper, and they can't afford to let the competition take off.