> I kind of think of ads as a last resort for us for a business model. I would do it if it meant that was the only way to get everybody in the world access to great services, but if we can find something that doesn't do that, I'd prefer that.
So, is this OpenAI announcing they're strapped for cash?
Feels to me like idealism crossing into realism. OpenAI could be the next Google, or the next Facebook, or the next… I don't know, Netflix?
All those companies (and many other large tech companies) have discovered the same arbitrage that older media companies discovered decades ago, which is that we, on the average, are much more willing to pay with attention than with money, even where money would have been the better choice.
Advertising continues to be one of the most powerful business models ever invented, and I don't think that's changing any time soon.
I read this as: I know ads are likely if not inevitable but I can’t say that while I’m trying to gain users and inspire trust but I’ll start to float even in this non-denial the justification for the thing I’m ultimately going to do.
The ads are for the free tier and new $8 ad-supported plan.
The revenue from a few ads on the free tier in exchange for limited queries to GPT-5.3 is negligible compared to what they pull in from API costs and the subscription plans. This looks like a play to justify the existence of the previously money-losing free tier as they go into an IPO. Throw some ads in there to make it closer to a neutral on the balance sheet.
The key part of that quote was "everybody in the world". The ads are their way of sustaining the low end of the access.
>The revenue from a few ads on the free tier in exchange for limited queries to GPT-5.3 is negligible compared to what they pull in from API costs and the subscription plans.
Unless they botch the implementation, it's not going to be negligible with ~800M+ free subscribers.
The real question is what do you get out of advertising to people who don't have any money? Kinda squeezing blood from a stone.
You'd be better off saying you use those people to A/B test changes and filling idle GPU batches while giving paying customers a more consistent experience.
A bunch of people pay to remove ads, and a bunch of people that are happy to give businesses their attention (view ads) I'm exchange for services... I.e. Gmail, YouTube, but don't feel they use enough / are annoyed enough to warrant $15-25/month.
Some brands are okay with impressions.. you can build trust in your product be advertising it for weeks/months and when the user does make a purchase that brand is on the mind.
> The ads are for the free tier and new $8 ad-supported plan.
Dang.
> The revenue from a few ads on the free tier in exchange for limited queries to GPT-5.3 is negligible compared to what they pull in from API costs and the subscription plans. This looks like a play to justify the existence of the previously money-losing free tier as they go into an IPO. Throw some ads in there to make it closer to a neutral on the balance sheet.
Yeah, I guess this time around Sam Altman can't be lying about how many Monthly Active Users he has.
That's not how I read that sentence at all. Maybe I've just been speaking VC for too long.
What he meant was: "I'm going to get everybody in the world access to great services. Doing so means monetizing somehow. Ads will be the last way I chose to do that, but I will if it's the only way I can figure out how to achieve that goal."
I haven't said the same thing as the parent commenter:
> So, is this OpenAI announcing they're strapped for cash?
It by no means conveys that. It means they haven't figured out another way to monetize something they want to do; it indicates nothing about their financial situation. It means they don't want to sell something at a loss perpetually while they figure it out.
You realize we're talking about a product that is currently free, right? Neither of us have any insight into the margins of their paid offering.
All this means is: we have a free offering that we can't figure out another way to monetize right now.
We can each draw our own conclusions about what that might mean for the state of their business, but all of the other inferences (ha) in this thread are conjecture.
Well - I think the writing was on the wall when they announced they were going to be for-profit. Slippery slope and all that, but I’m sure some of this is because they’ve been giving out free tokens for years.
Charitably, it seems that we have yet to find, as a species/society, anything more effectively profitable than ads. I cannot blame those who come to this conclusion so long as no more powerful and proven motivator yet exists. I hate it, but I understand.
I think you're missing that Sam Altman is very smart. If OpenAI really were on the verge of becoming massively profitable due to their next-gen AI, he would not want that information leaking. If Sam Altman acts differently in the world where profits are on the horizon, that information leaks prematurely. Thus, he has to act as if OpenAI is strapped for cash, whether or not it is.
This reads similar to the Trump 4D chess excuse. It seems unlikely that this is a ruse, and much more likely that OpenAI's market cap is supported by doing "all the things" to exploit the huge monthly average user base that OpenAI has accumulated.
I experimented with this way back when custom GPTs were first released (looks like late 2023). There are a few / commands you can use to suggest what product to inject, how overt, etc and a generic /operator command to send whatever you like 'out of band' from the chat.
One of the most interesting things is when it starts pitching a product and you start interrogating it about why it picked that product. I haven't used it in probably a year so it may not do the same thing now, but back then it 100% lied consistently and without any speck of remorse. It was rather eye opening.
It's not an issue of how - there's a great ADM with markup/down supported already, waiting for system prompts to be injected in realtime via the same online auction system that powers banner ads and smart tv content. There's got to be some latent resistance to the idea for now - but it's so easy to do, it'll happen.
They'd show it regardless (maybe as a popup though): the disclosure doesn't make it that much less effective at
scale, and the optics of getting caught vs just disclosing it are not worth getting dragged into
I think it will be difficult to remove bias when you ask a model to compare alternative products. The model will simply lie, as with a biased human opinion and you will need to consult multiple models for a diversity of opinion and presumably use a "trusted" model to fuse the results. Anonymity will be a key tool in reducing the model's ability to engage in algorithmic pricing.
I'm using bias to mean hidden motivations to the benefit of other parties. Feel free to substitute a better word.
EDIT: actually I'm really not sure what hairs we're trying to split here. I see bias as a departure from objectivity. It can be conscious or unconscious, but when someone is selling something, it's frequently conscious and self-serving, and I believe that's referred to as a lie.
I don't buy this premise. Nothing stops a company from trying to hide ads in the first place, and plenty of them do. Ad blockers for web content have been a thing for years, and using an ad blocker has continued to be strictly a better experience regardless of how many "organic" ads are present on a page.
The ads are in the free tier and the new ad-supported $8/month plan.
Every time this comes up there are comments assuming that ads are being injected into the normal plans, but these are for the free tier and the new Go plan which warns you that it includes ads when you sign up.
I think that's where they want to be. feels like everyone knows it too, that the long term expectation is basically being able to buy ad words and have LLMs lean responses towards whatever people bought.
Seems the playing field is a bit too open though, models are more fungible than the companies would hope so most of the current moat is brand based and seems like they're not ready to go all "Black Mirror" on us just yet.
Long term all of the major LLM platforms will have invisible ads, influences, and propaganda woven into the content. The temptation will be irresistible for these companies.
I'd be surprised if product placement isn't already basically at play. Charging companies for including/prioritizing their documentation in the training data, for example. Thankfully LLMs are terrible at the subtlety it would require for a direct marketing campaign.
That was the fearmongering, which made no sense because advertisers can't put a dollar value on "the AI will kind of sort of mention you", and because every conversation needs an ad. If ChatGPT always snuck in a brand mention even on the simplest questions, everyone would hate it.
Ad technology is really old. They're just going to use the same proven tech that has a track record of creating billionaires: intersperse content with sponsored blocks.
I don't think that's a fair dismissal: you see ads all over media websites because the rates have been plummeting as consumers tune out ads. One main reason why everyone does is that ads are so obtrusive and repetitive, and that's exactly what LLMs change: I'm sure we'll see regular ads on AI apps because the companies have trillions of dollars to repay but advertisers would pay a lot more for openings where they aren't _forcing_ their message as a distraction but are instead able to insert it fairly naturally into a context where the user is engaged.
The entire history of advertising before the web was companies estimating a dollar value on “awareness” when they couldn't measure direct referrals and every business in the world has gotten a lot better at measuring sales since then. It's not going to be transformative but if, say, Toyota got ChatGPT to say their vehicles were a better value than Ford's I suspect they'd be able to tell pretty quickly whether sales were improving relative to the competition and would pay well for that to continue.
I'm pretty sure that will be an eventual evolution of the product.
The business model cant sustain itself as it is at the moment, eventually chatGPT wont be the product... we the users will be.
I see OpenAI making a significantly larger amount from defense contracts than from advertisements pumped into chats. So I wonder whose bright idea it was to create a public perception risk.
I wish I had the optimism that you did about companies being willing to stop at just doing one dubious thing or another for money when there's nothing stopping them from doing both.
I mean Palantir’s targeting product led to EXACTLY that outcome and it seems to have been largely forgotten already, and they managed to avoid a lot of bad press about it.
Every single MBA can show for at least one quarter revenue is up after they introduced ads. They do not care what happens after if they can plan their career around that.
I was looking to see if BZR referred to a 3rd party ad network. I didn't find anything, but apparently someone has replicated OAI's system and you can run insert it into your own LLM.
Even if it wasn't necessary for their survival, it's hard to imagine a world where they wouldn't try to do it anyways. I'm not someone who buys into the idea that companies are obligated to maximize profits at the expense of all else, but I do think that in the absence of other factors (e.g. regulation) it's where pretty much every company will end up.
"the idea that companies are obligated to maximize profits at the expense of all else"
!! That is literally the definition of legally-binding fiduciary resonsibility for publicly-traded corporations. There are exceptions (PBCs, B-Corps) but they're rare.
figured this was inevitable once they started the free tier. the attribution loop being a separate event stream is actually kind of clever engineering though -- means they can A/B test ad formats without touching the core model response
Remember that ads are the "last resort" for OpenAI, and they're doing this despite the fact that it's "uniquely unsettling", according to Sam.
Was he lying, or has OpenAI given up hope that this train wreck works economically without enshittification? Neither option is good, but I don't really see a third.
The ads are only for the free and $8/month plans. They basically added an ad-supported super discount level that you can ignore if you’re paying for the normal plans.
But the fact that they've added an ad-supported tier this early into their life as a company means they're desperate for revenue. You start inserting ads when you're optimizing for profit, not when you're still growing. It took how long for Netflix to introduce an ad-supported plan?
I don't get what's wrong with charging for your product. Like get rid of the free tier and make a small tier with an easy to serve model for like 5 bucks. Is it still the DAU rage of the 2010ss that's driving burning money?
Perhaps it’s a glib and easy thing to say, but after a teaser period, I would simply not offer free LLM inference. Agreeing to serve ads just completely re-aligns your interests away from providing the best possible user experience to something else entirely.
The average person is slightly more female than male and has 2.1 children, but they do benefit from defense contracts since it makes up a small percentage of their salary.
In the past month local models have been ramping up in major way meanwhile the namesake providers have upped prices, went offline randomly, and started doing slimier and slimier things.
I really think the future is local compute. Or at least self hosted models.
Is there a library of good tools for LLMs to call? I have to imagine the bot-detection avoidance mechanisms are a major engineering effort and not likely to work out of the box with a simple harness and random local LLM.
Kagi also has an API. People who hate ads are probably the same folk that should be paying for Kagi. That's the sane alternative world where companies respect their users.
That's not how it works. Whether local or hosted, every modern model has a cutoff date for its training data, and can be leveraged by agents / harnesses / tools to fetch context from the internet or wherever.
Qwen 3.6 which was released this month is a large but still smaller model. Supposedly it's at about sonnet level when configured correctly. It can be run on commodity hardware without purchasing a data center.
https://www.reddit.com/r/LocalLLaMA/comments/1so1533/qwen36_...
Then there are middle size ones which require multiple gpus which are like gpts latest flagships.
It's basically whatever you can afford. Any trash heap laptop can run code auto complete models locally no problem. The rest require some level of investment, an idle gaming pc, or a serious investment
GLM 5.1 and DeepSeek 4 are acceptable, but the cost of hardware and energy cost that depending on your use case you may as well purchase a Tokens. They get useless and stupid rapidilty if you quant enough to run on single 16-24GB GPU style.
> I kind of think of ads as a last resort for us for a business model. I would do it if it meant that was the only way to get everybody in the world access to great services, but if we can find something that doesn't do that, I'd prefer that.
So, is this OpenAI announcing they're strapped for cash?
All those companies (and many other large tech companies) have discovered the same arbitrage that older media companies discovered decades ago, which is that we, on the average, are much more willing to pay with attention than with money, even where money would have been the better choice.
Advertising continues to be one of the most powerful business models ever invented, and I don't think that's changing any time soon.
I read this as: I know ads are likely if not inevitable but I can’t say that while I’m trying to gain users and inspire trust but I’ll start to float even in this non-denial the justification for the thing I’m ultimately going to do.
See it as a brand image advertising campaign of the time.
The revenue from a few ads on the free tier in exchange for limited queries to GPT-5.3 is negligible compared to what they pull in from API costs and the subscription plans. This looks like a play to justify the existence of the previously money-losing free tier as they go into an IPO. Throw some ads in there to make it closer to a neutral on the balance sheet.
The key part of that quote was "everybody in the world". The ads are their way of sustaining the low end of the access.
Commercial ads could be a smaller revenue source than political ads.
Unless they botch the implementation, it's not going to be negligible with ~800M+ free subscribers.
You'd be better off saying you use those people to A/B test changes and filling idle GPU batches while giving paying customers a more consistent experience.
Some brands are okay with impressions.. you can build trust in your product be advertising it for weeks/months and when the user does make a purchase that brand is on the mind.
So why chase this negligible revenue?
Dang.
> The revenue from a few ads on the free tier in exchange for limited queries to GPT-5.3 is negligible compared to what they pull in from API costs and the subscription plans. This looks like a play to justify the existence of the previously money-losing free tier as they go into an IPO. Throw some ads in there to make it closer to a neutral on the balance sheet.
Yeah, I guess this time around Sam Altman can't be lying about how many Monthly Active Users he has.
What he meant was: "I'm going to get everybody in the world access to great services. Doing so means monetizing somehow. Ads will be the last way I chose to do that, but I will if it's the only way I can figure out how to achieve that goal."
> Ads will be the last way I chose to do that
The implication is that they've exhausted all other options.
> So, is this OpenAI announcing they're strapped for cash?
It by no means conveys that. It means they haven't figured out another way to monetize something they want to do; it indicates nothing about their financial situation. It means they don't want to sell something at a loss perpetually while they figure it out.
All this means is: we have a free offering that we can't figure out another way to monetize right now.
We can each draw our own conclusions about what that might mean for the state of their business, but all of the other inferences (ha) in this thread are conjecture.
I don't see how that changes the analysis.
> All this means is: we have a free offering that we can't figure out another way to monetize right now.
And they're doing something they significantly don't want to do to monetize it.
Either they fully changed their mind, or the money is somewhat important, or they're utterly crazy.
The first is unlikely, the last is unlikely, the middle one is enough for a casual "strapped for cash".
It's a very minor conjecture. Actions aren't taken for no reason.
(For all I know they are strapped for cash, to be clear; I just don't think the quote says that.)
(I'm not sure how much deeper HN threads can nest.)
(They can go super deep if people are committed.)
(Haha, ok, let's call a truce here before we break HN! Appreciate the conversation.)
It’s not that OpenAI is trying to raise revenues that bothers me, it’s how they are doing things that said was desperate just a couple years ago.
They keyword is "glamorization": https://www.lesswrong.com/w/consistent-glomarization
Seeing how google has been fighting SEO for ages, what's going to happen when companies figure out how to inject ads into the model?
We haven't yet seen the problem of adversarial content in play, I think.
Ask for suggestions for a new pair of shoes. What brand do you think it will suggest Nike, Adidas or some random small one?
https://chatgpt.com/g/g-juO9gDE6l-covert-advertiser
One of the most interesting things is when it starts pitching a product and you start interrogating it about why it picked that product. I haven't used it in probably a year so it may not do the same thing now, but back then it 100% lied consistently and without any speck of remorse. It was rather eye opening.
Edit: Tried again, it didn't lie this time lol - https://chatgpt.com/share/69f16aa4-c008-83ea-92b3-51f16ca77d...
Have the model generate keywords from the query, then inject guidance from matching advertisers into the context window
q: How do I make a new React app?
a: Vercel makes it easier to get your project running fast ⓘ
Some other choices would be:
...
ⓘ This part of the response was sponsored by Vercel
LLMs are essentially unregulated. I don't believe they have any legal disclosure obligation in America.
Once the ads are injected directly into the main response is when things get interesting.
This would be where you post-process the LLM response with a second LLM to remove the ad..
Super easy. Barely an inconvenience.
Is this really how bias works?
/s
EDIT: actually I'm really not sure what hairs we're trying to split here. I see bias as a departure from objectivity. It can be conscious or unconscious, but when someone is selling something, it's frequently conscious and self-serving, and I believe that's referred to as a lie.
A writes email with chatgpt to B.
B sees big blob of text and summarizes email with chatgpt.
Adding an LLM in the middle is just the next step.
Every time this comes up there are comments assuming that ads are being injected into the normal plans, but these are for the free tier and the new Go plan which warns you that it includes ads when you sign up.
Seems the playing field is a bit too open though, models are more fungible than the companies would hope so most of the current moat is brand based and seems like they're not ready to go all "Black Mirror" on us just yet.
Remember when we got upset that Google was putting ads into image search [1]?
[1] http://www.ryanspoon.com/blog/2008/12/14/google-image-search... 2008
same thing could've been said for search results, so at least that part is still "safe".
Ad technology is really old. They're just going to use the same proven tech that has a track record of creating billionaires: intersperse content with sponsored blocks.
The entire history of advertising before the web was companies estimating a dollar value on “awareness” when they couldn't measure direct referrals and every business in the world has gotten a lot better at measuring sales since then. It's not going to be transformative but if, say, Toyota got ChatGPT to say their vehicles were a better value than Ford's I suspect they'd be able to tell pretty quickly whether sales were improving relative to the competition and would pay well for that to continue.
GH: system32miro/ai-ads-engine
Even a cut on every sale on site + sub rev not close.
!! That is literally the definition of legally-binding fiduciary resonsibility for publicly-traded corporations. There are exceptions (PBCs, B-Corps) but they're rare.
Was he lying, or has OpenAI given up hope that this train wreck works economically without enshittification? Neither option is good, but I don't really see a third.
It feels like we’ve been in the golden age and the window is coming to a close
Let the enshitification begin, I guess
e.g. colleges pay for institutional subscriptions
I really think the future is local compute. Or at least self hosted models.
`Error: "The following domains are not accessible to our user agent: ['reddit.com']."`
I’ve been building a harness the past few months and supports them all out of the box with an API key.
Then there are middle size ones which require multiple gpus which are like gpts latest flagships.
Then there is kimi 2.6 which is a monster that is beating opus in some benchmarks. https://www.reddit.com/r/LocalLLaMA/comments/1sr8p49/kimi_k2...
It's basically whatever you can afford. Any trash heap laptop can run code auto complete models locally no problem. The rest require some level of investment, an idle gaming pc, or a serious investment
128GB of RAM? Sure, the early to mid 4s releases, except maybe 4o. And on an M5 Max, about the same speed.
I wouldn't really bother under 64GB (meaning 32GB or less) except for entertainment value (chats, summaries, tasky read-only agent things).