Perplexity Abandons AI Advertising Strategy Over Trust Worries - MacRumors
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Perplexity Abandons AI Advertising Strategy Over Trust Worries

AI company Perplexity is stepping away from advertising over concerns that it will erode user trust, despite moves by rivals to introduce ads as an alternative money-making strategy.

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Perplexity was one of the first AI services to embrace ads in 2024, after it ran tests where sponsored answers appeared under the chatbot's answers. That approach however was phased out last year, and executives at the company now say they don't plan to revisit it, according to the Financial Times.

"A user needs to believe this is the best possible answer, to keep using the product and be willing to pay for it," a Perplexity executive told the publication.

The report follows OpenAI's move earlier this month to show ads to ChatGPT users who have a free account or a low-cost Go subscription. OpenAI has said ads will not influence the answers that ChatGPT provides, nor will it provide advertisers with content from ChatGPT conversations.

Anthropic, the makers of Claude, recently mocked OpenAI for its decision to show ads to users and has said it has no plans to do the same. The company argues that including ads in Claude would not be in line with its mission of creating a helpful assistant for work and deep thinking, and that users should not need to second-guess whether an AI is being helpful or "subtly steering the conversation towards something monetizable."

Google features advertising in AI mode and in its AI Overviews summaries on traditional search results. However, Google has not introduced ads into its Gemini chatbot so far.

Ad strategies are one way that AI companies have been looking at as a way to generate revenue from users and reassure investors while spending heavily to train and operate large language models. Meanwhile, the cost of training and running large language models continues to climb, with no profit to show for it.

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Top Rated Comments

10 months ago
The A.I. bubble is going to pop at any moment now 😆 most companies are figuring out they have created a monster without any regulation/safety switch.
Score: 17 Votes (Like | Disagree)
boswald Avatar
10 months ago

The A.I. bubble is going to pop at any moment now 😆 most companies are figuring out they have created a monster without any regulation/safety switch.
And it can't happen soon enough.
Score: 14 Votes (Like | Disagree)
10 months ago

The A.I. bubble is going to pop at any moment now 😆 most companies are figuring out they have created a monster without any regulation/safety switch.
A stupid monster. ChatGPT can't remember basic things that have already been established within the same chat thread, and I've tested them with some real-world tests for humans, given the same guidelines and questions and they only get about 40% correct.

The problem with monetizing LLMs is that they're not that useful. They're basically only good at summarizing things you've given them, and even then they regularly misinterpret, hallucinate or remove critical information. By the time you've double and triple checked their work, and corrected it, you could have just done it all yourself.

They're just not worth paying for at the moment. Their video and photo generation is getting better, but their basic logic, reasoning and understanding is not improving at all, in some cases I think it might be getting worse.
Score: 12 Votes (Like | Disagree)
cjsuk Avatar
10 months ago

A stupid monster. ChatGPT can't remember basic things that have already been established within the same chat thread, and I've tested them with some real-world tests for humans, given the same guidelines and questions and they only get about 40% correct.

The problem with monetizing LLMs is that they're not that useful. They're basically only good at summarizing things you've given them, and even then the regularly misinterpret, hallucinate or remove critical information. By the time you've double and triple checked their work, and corrected it, you could have just done it all yourself.

They're just not worth paying for at the moment. Their video and photo generation is getting better, but their basic logic, reasoning and understanding is not improving at all, in some cases I think it might be getting worse.
Exactly that.

I note that you say that they're good at summarising stuff then immediately discredit it, so I'd argue they are no use for that too.

Anyway it gets worse as this post describes well...




People are tuned to the science fiction definition of AI when in fact we have LLMs which are statistical ******** generators.

The only reason they are as successful as they are is due to the relatively high level of incompetence of people who use them and the marketing job.

Attachment Image
Score: 11 Votes (Like | Disagree)
WarmWinterHat Avatar
10 months ago

Surprised by the number of people here on a tech forum that actually think AI is going away. There has never been a technology that has gone from ~ unused to essential in so short period for so many users. That has occurred in a single year, even for the technologically uninclined. Hoping it away is simply silly, head in the sand behavior.

Are the security concerns real, absolutely. Are the market bubble concerns real? Likely, and to what degree we'll find out. Is AI going away? Absolutely not.

Companies like Anthropic see less than 20% of their revenue from individual users who would potentially be looking at advertising. Most is enterprise. Google/deep mind usage of their AI is interwoven into all of their products and is not directly reliant on consumer spend for the lion share of what they're doing. OpenAI is an outlier there as they are largely consumer based right now. Focusing on monetizing that one segment is an interesting sidenote but far from the big picture.
I don't see anything saying it's going away, just that it's a bubble. Dot.com was a bubble, and the web didn't go away...and I don't see any industry, outside of tech, where AI is "essential". Not everyone works in tech; I don't. Just a guess, obviously, but I think around 10% of the current crop of AI companies will still be around in 5 years, and the survivors likely won't be pure AI providers, like Google, for example.

Now if someone can come with an equivalent usable system that doesn't require the power of a thousand suns, and enough hardware to build death star, they will be the winner....The current direction of LLMs is unsustainable for a multitude of reasons, and the quicker it dies, the better.
Score: 6 Votes (Like | Disagree)
10 months ago
Surprised by the number of people here on a tech forum that actually think AI is going away. There has never been a technology that has gone from ~ unused to essential in so short period for so many users. That has occurred in a single year, even for the technologically uninclined. Hoping it away is simply silly, head in the sand behavior.

Are the security concerns real, absolutely. Are the market bubble concerns real? Likely, and to what degree we'll find out. Is AI going away? Absolutely not.

Companies like Anthropic see less than 20% of their revenue from individual users who would potentially be looking at advertising. Most is enterprise. Google/deep mind usage of their AI is interwoven into all of their products and is not directly reliant on consumer spend for the lion share of what they're doing. OpenAI is an outlier there as they are largely consumer based right now. Focusing on monetizing that one segment is an interesting sidenote but far from the big picture.
Score: 6 Votes (Like | Disagree)
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