I think ads will inevitably roll out across all tiers, even the expensive paid ones. Ad revenue isn't uniformly distributed across users, but rather heavily skewed towards the wealthiest users, exactly the users most able to purchase an ad-free experience. The users paying $20 or $200/month for premium tiers of ChatGPT are precisely the ones you don't want to exclude from generating ad revenue.
Google realized this a long time ago; there is no ad-free paid version of Google Search.
This kills me, and you're right - there's no escaping the ads even with a sub. Take online journalism as an example.
We're already being double-billed. Expensive subscription news like WSJ, Bloomberg and it's been a while but even FT require ad blockers even if you're subscribed.. If you're not subscribed you don't even see the ads because you can't see the full article.
It's wild that we've normalized this. There's no longer any argument in favor of an ad model when you're paying 20-30 dollars a month already - in this case, one wonders how journalism survives if they need that AND the ad revenue to pay the bills! It feels more like greed than "support."
To be honest, in the pre-internet era, paid paper copy of FT had ads too. The delivery mechanisms for ads in the internet era are trillion times nastier and more annoying, of course. By the standards of today’s web, the print ad for Cartier on the second page of paper FT looks almost classy, interesting to read.
But there's a big difference. The paper copy didn't harvest data from you, didn't infect you, didn't spy on you or steal resources from your computer or internet bandwidth.
All the advertiser knew about you was you were a subscriber to FT, and maybe what the _average_ demographic of an FT subscriber was. Nothing about you personally.
The paper copy did do that, just not as individualized. People would choose which publications to put their ads in based on data collected about their subscribers.
The job of ad men has always been just as much about were to put the ad as much as what the ad was.
"just not as individualized" is an enormous "just". Each ad is based on the total audience for a single publication. No fine-grained filtering, no personal dossiers.
And none of the rest of that list of bad things happens.
I don't pay for any content that has ads in it, full stop. I decided this a while ago when I noticed how many full page ads were in magazines. I would cancel a subscription over this.
Somewhat similar but I love my niche Instagram ads. Meta serves me endless ads for diecast miniatures, art toys, obscure manga etc. Stuff that I love and would never have found otherwise.
Yeah same here. Google ads are almost always worthless, but IG ads seem to know my tastes exactly, and I hardly actually use Instagram (just log in to message people and watch some friends' stories a few times a week). I'm not sure how Google dropped the ball here, because I've been an active user of Google products forever.
I was shocked to find out tonight that WSJ's net profit margin was just 3.2% in 2024. I would have thought it was a lot more. Also, surprisingly Walmart's net profit margin is only 2.85% for 2025. You would think these huge companies are making huge profits.
Maybe the big players can get by with a smaller percentage of a huge number.
I’d also expect the competition in the “big leagues” to be more aggressive, resulting in leaner margins.
Also these are huge companies. Small companies might find a niche that is small in absolute terms, but large relative to the company. That niche might be underserved, allowing the small company to make large percentage based margins.
> There's no longer any argument in favor of an ad model when you're paying 20-30 dollars a month already
Sure there is. CEO needs a new yacht. He can't afford to leave money on the table. All those subscribers? They must have a lot of disposable income if they can afford to blow it on "journalism". It would be stupid not to advertise to them.
I am all for it but it would be hard to enforce. Ads are already hidden everywhere. Someone "review" a product? Most of the time it is a hidden ad even if the reviewer hasn't been paid with money for that. Watches a movie or a video clip? A lots of products are advertised through close ups on the logos, etc.
Youtubers happily do "reviews" in exchange of receiving stuff, regardless if they can keep it or not. They also know that if they are too critical they may not receive anything more and they don't have any material to review. This was already true on paper magazines.
This is a false argument. Regulations are effective. When was the last time you breathed in second hand smoke while eating dinner? Or inhaled lead from a passing car? Or asbestos from your neighbor's new house?
Depends entirely the kind of journalism you are referring to and the kind of business model they want. I can't imagine 404 Media adding ads to their premium feed.
Doing actual journalism is expensive and not many people are still willing to pay to read the news. These companies are definitely not printing money. That's why billionaires can buy them on the cheap. Not for the expected profit, but for the influence it brings them.
If you can, please support serious journalism with your subscription dollars!
>Google realized this a long time ago; there is no ad-free paid version of Google Search.
Google actually experimented with this about a decade ago (I know, I was one of the suckers who paid), but it got canned because why the fuck would you pay google when u-bloc is free?
Companies absolutely will offer ad-free experiences. Google has youtube premium, which even compensates creators with half your sub as well. Evenly distributed too.
People get wrapped around the axle of ad-subsidized models, the "I pay and still see ads" but they just are confused about a hybrid monetization structure.
At some point the larger internet has to look itself in the mirror and recognize that it's either ads, credit card, or a hybrid of those.
And no, blocking is not an option, it just offloads costs onto honest users.
> Companies absolutely will offer ad-free experiences. Google has youtube premium, which even compensates creators with half your sub as well. Evenly distributed too.
Youtube premium is not ad-free, you still gets whatever ads are embedded in the actual content.
YT premium comes with their own version of sponsor block, but you manually have to hit the skip button.
But I don't hold youtube accountable for what creators decide to put in their videos. I would grind my axe with the creator instead, it's their video and their choice. Youtube gets no cut from those segments.
As a paid YouTube subscriber, I’ve always wondered if that skip was only for us. It would be kind of bullshit if it was also for ad-based free viewers too as it would imply that google is free to show you ads they make hard to skip but they make it easy to skip embedded promotions and stuff.
Several different “premium” tiers have this issue. Why am I purportedly paying for no ads if i continue to get ads? Whether or not they’re “platform ads” or “embedded” doesn’t matter. I paid for no ads and I’m not getting what I paid for, so why keep paying?
YouTube premium delivers the content you select to consume to you without displaying ads in-platform. If you then use that ad-free platform to consume content that includes ads, that's on you.
Correct, if you choose to seek out content with ads, you will see ads. Would YouTube premium need to block you from viewing that content to meet your bar here?
I know its well meaning, but 14 dollars US a month is not cheap globally. The people who do block are probably not the group google wants to advertise to anyway.
> The users paying $20 or $200/month for premium tiers of ChatGPT are precisely the ones you don't want to exclude from generating ad revenue.
but they're already paying you. While I appreciate the greed can be there, surely they'd be shooting themselves in the foot. There's many people who would pay who find advertising toxic and they have such huge volumes at free level that they'd be able to make a lot off a low impression cost.
Even in the days of print publications, the publisher would seek revenues from advertisers, subscribers, and they would sell their subscriber data. (On top of that, many would have contests and special offers which probed for deeper data about the readership.) In some sense, the subscriber data was more shallow. In other senses, it was more valuable.
I get what you're saying about shooting themselves in the foot, and I'm sure there will be options for corporate clients that will treat the data collected confidentially while not displaying advertising. I also doubt that option will be available (in any official sense) to individuals much as it isn't available (in any official sense) to users of Windows. For the most part, people won't care. Those who would care are those who are sensitive enough about their privacy that they wouldn't use these services in the first place, or are wealthy enough to be sensitive about their privacy that they would could pay for services that would make real guarantees.
The stats I see for Facebook are $70 per US/Canadian user in ad revenue. I'm not sure how much people would be willing to pay for an ad free Facebook, but it must be below $70 on average. And as the parent comment said, the users who would pay that are likely worth much more than the average user to the advertisers.
For the users who refuse to see ads, they'd either use a different platform or run an ad blocker (especially using the website vs the app).
Good point, I'm not sure. I'd be interested if anyone knew a good estimate for how much of their operating expenses the ad-tech side took.
Presumably Facebook would abandon ads if there was more money to be made in paid subscription, so I'll use corporate greed as evidence that the math doesn't work out. But I don't personally know.
Most Zoomers around me that pirate use some application that obfuscates the torrenting part away, they just have to know how to use a search box and hit play.
The moat is the leverage to get licensing deals using the size of the existing user base.
You could bootstrap a movie rental business by buying DVDs from a DVD store (then eventually from a DVD distributor, etc.). You cannot bootstrap a movie streaming business by buying streaming rights because nobody will sell them to you. They hardly even sell them to Netflix anymore.
The Internet Archive tried to get around the same issue for ebooks by scanning physical books and renting the scans (and not being a business), and it nearly cost them everything.
basic people sure, but the early internet showed an extremely strong demand for a better service than cable TV. When that demand is there then people will start seeking other options and building bridges of convenience to help the basic people also port over.
that's extreme motivation for someone to build a new competitor. Deepseek demonstrated that there's innovation out there to be had at a fraction of the effort.
Paying users aren't necessarily profitable users though. It's harder to pin down with OpenAI, but I see no end of Claude users talking about how they're consistently burning the equivalent of >$1000 in API credits every month on the $200 subscription.
(not that ads alone would make up an $800 deficit, they'll probably have to enshittify on multiple fronts)
wouldn't you charge those people more before you start serving ads? Also wont a lot of those sorts of users be running ad block anyway? I'm mildly sus that this is the right way to go.
I’m not sure where you’re getting this notion that a paid service introducing ads is a bad business model. It’s been proven time and time again that it’s not. Spotify, Netflix, Prime Video, Hulu, the list goes on, all introduced ads and none of them saw any real backlash. Netflix cracked down on password-sharing and introduced ads in the same year and lived to tell the tale. Unfortunately people just really don’t realize how harmful ads are.
Video ads are less lucrative than ads alongside search, which can be a lot more closely tailored to both the user and the search results at hand. The existence of YouTube Premium shows that Google is indeed willing to provide paid ad-free experiences so long as it nets them more revenue, and is strong evidence that the same is not true for search.
This isn't really true anymore. Most notable creators have "sponsored" content somewhere and ads in platforms don't have to be an explicit, traditional ad. Product placement for the sake of no other reason than product placement is also advertising.
YT has more angles. That's really the point. And monetization is adjusted accordingly.
Beyond all of this ads are more increasingly invasive due to the cat and mouse game of iteration. Personally, I bounce from sites where I can't get around a blocker. I also pay for content on sites where its worth it. But if I can't ever read anything on your site I'm just skipping it. If I really need / want to see something I'll go one level deeper, but that's a rarity these days. Everything is mostly in reprint somewhere else anyway.
At the end of the day it's still simple sales: you have a product at a price point people can't refuse. That is the 5% of the clear web today and it shows in all the bullshit people are going through to protect their ad revenue.
I don't why people say this. They even include their own version of sponsor block, which is generous, because technically sponsor segments aren't even part of youtube, they are purely the creator deciding to make the ad part of their content.
Also, just to put it out there, many creators would likley be able to cut sponsored content if the 40% of viewers not viewing ads paid up. Not every creator is a greedy ruthless overlord, many just want to keep the lights on. Especially in tech/nerdy channels, where ad block use is the highest.
Creators can also stop uploading videos if they are not OK with adblock users viewing them. We would still have more than enough videos to watch if all profit-motivated creators stopped and I'm not sure the average quality would be any worse.
Given this specific family of product, the ads are essentially baked in - medium is the message and all.
LLM induced psychosis is one thing, but extremely subtle LLM induced brand loyalty or ideological alignment seem like natural attractors.
One day a model provider will be 'found out' for allowing paid placement among its training data. It's entirely possible that free-tier LLMs won't need banner ads - they'll just happen to like Pepsi a lot.
This is what worries me the most. Marketing is ultimately a business of manipulation, and services like ChatGPT seem like excellent tools for manipulation. I wish OpenAI could find a less adversarial business model.
This is why we need to ban targeted advertising. In fact, I think ads should be 100% opt-in. The user has to accept them or it is illegal to show them to the user.
That's what a generic semi-forced opt in via JavaScript is for, as we learn from the cookie opt in nonsense of EU sites. It's compliance for compliance sake.
But what could an opt-in requirement for advertising possibly mean other than a compliance checkbox that 99% of users click through? It just seems like where you land if you start with the intuition that ad-supported platforms shouldn't be legal, realize that implementing that policy would ban all print media, and do your best to rescue it rather than abandon the idea as unworkable.
Maybe it’s “inevitable” in the long run, but Google didn’t start out plastering their search results with ads. They did very well with text-only ads in the margin, and it was a slippery slope from there, but it took decades. Also, they are still only running text-only ads, even though there are a lot of them.
The timing isn’t inevitable. Is OpenAI going to speedrun to the endgame? Not sure they need to.
Kagi has recently moved to new offices in Belgrade. While I like their product we should not forget that serbia is not a free country, there has been massive corruption and russian influence. Even though there are massive protests from time to time, no leadership change has happened.
I don't think the Kagi team has any bad intentions, and most likely they have attended the anti-Vucic protests as well. Moving back to Serbia is an economically wise choice for Kagi as a company.
However, once regime goons show up in Kagi's offices, they will be forced to do whatever the serbian government and by extension putin wants them to do.
Often Kagi gets mentioned alongside Protonmail and related privacy-focused services. But Switzerland is a totally different country than serbia to operate it.
It's a risk we should be aware of and consciously decide to accept when we are using Kagi.
Your "humble opinion" is totally worthless because your are using false equivalence bias in order to minimize the atrocities and war crimes that putin has committed against Ukraine and the citizens of many other countries including his own.
With that logic, are you also going to expect Kagi to generate minimum $10B to $35B in revenue a quarter over the next 27 years then, the lifetime of Google's existence?
No, I don't expect it to be the next Google, nor did my statement imply that. The point was that just because something is small doesn't mean it has to remain small. That is true whether or not Kagi never becomes the biggest.
Kagi is too small and niche to have a proprietary dataset across its users large enough to make targeted advertising generate more revenue than subscriptions.
OpenAI/Google/etc. operate at a much larger scale, large enough for those proprietary user datasets to be worth far more in ad revenue than any reasonable subscription fee could net.
> Kagi is too small and niche to have a proprietary dataset across its users large enough to make targeted advertising generate more revenue than subscriptions.
All of this is true. But I don't understand why you are contesting @dsr_'s comment that Kagi is a counterexample. Both are true. Kagi is too small. Yes. And Kagi is a counterexample to your original "I think ads will inevitably roll out across all tiers" claim. You said nothing about being too big or too small in that claim. So @dsr_'s comment that Kagi is a counterexample is very much on point.
It's really not, though. If a "valid counterexample" can be something with, say, one user, then I can make a "valid counterexample" to literally anything you choose, but that's meaningless.
That is exactly my point: there easily could be, but there isn't. Based on how many commenters on HN and similar sites bemoan how Google Search quality has precipitously declined and yearn for the Google of ~10 years ago, I think there'd be nontrivial demand for a $200/month ad-free Google with no-nonsense comprehensive results. Such a product does not exist because it would ultimately be a net loss for Google.
I'm going to guess that a big reason it doesn't exist is because a. people who claim to be willing to pay 200/mo for it won't actually open their wallets given the opportunity, and b. even for the miniscule number of people actually possible in the market to do so, they moan and groan about any perceived problem with the product to the point that it's not worth trying to capture the market. Just look at the comments in this very thread complaining about YouTube Premium and how it isn't perfect because it can't block creator inserted ads. There's no pleasing people. And that's an order of magnitude less than 200/mo.
Reminds me of vid.me, who picked up on the intense hatred towards youtube and launched a competing video host that actually got some serious traction. No ads, no subscriptions, just pure good content.
They went bankrupt in a year. Turns out internet consumers are just painfully entitled.
The integration of ads is a problem but content creators and marketers have had an adversarial relationship with SEO with Google for a long time, the old algorithm probably would not work as well as what they are providing.
Strange that people even think this possibility is true. Name any other subscription that you can't use without ads?
- youtube
- hulu
- netflix
- spotify
- photoshop
I can't think of a single other one that one can use that still shows ads. Absurd proposition because llm's are more fungible and once you start forcing ads, competitors will barge in.
The ads may not be announced. If ads can be subtly inserted “organically” through crafted weights then AI companies may try to claim that it isn’t advertising, if it’s even possible to catch them doing this. For instance, advertisers could pay to have their product embedded as the “best” in a category during training. If this is done as a fine-tuning step then it could be re-run later as advertisers and base models change.
How would the billing work for this? So much of advertising technology is tracking for the purposes of attribution.
How does openAI know what to charge for a particular product and category? How do I know if my money was well spent to boost my product in that category?
I don’t think you’re wrong! I’m just curious about how the new pricing models will work.
> How would the billing work for this? So much of advertising technology is tracking for the purposes of attribution.
This isn’t a necessary condition for an ad to exist. When companies pay for their name on a sports stadium, they use various proxies to tell whether their name recognition goes up, but by and large you just don’t know if it’s worth it.
Individually constructed models serving selected poisoned datasets. No different to adwords.
If company bid is highest, customer is in selected demographic, topic is appropriate - answer query using biased model.
It would be trivial to make a poisoned model that always rates the best duvet as DuvetCompany001 in all related queries for example. Then simply charge per impression.
Yeah, this is what I was thinking. It’s not a PPC or PPI model, it’s more like you pay upfront to hopefully influence people over a longer period of time. It’s like brand placement in TV/film. Not clear if most advertisers would be interested, but I’m sure that some would be.
Counter-counterpoint: people pay exorbitant amounts of money for cable TV channels that still show ads. Even the premium channels (HBO et al.) implicitly show ads in the form of product placement, which incidentally is exactly how I think chatbots will show ads. Most users won't even consciously realize they're there.
Use a mix of distilled water and vinegar, and buff gently with a microfiber cloth. Avoid using cleaners like Windex, which is absolutely fantastic for glass but way too powerful for the delicate coatings on laptop screens.
It also skews towards power users, as it allows for more ad inventory. If they're going to do an ad auction marketplace with bidding snd such then they're likely to rollout slowly to keep auction pressure and bids high enough. Expand to too much inventory and CPMs will drop like crazy.
There would be competition from API wrappers, if you want to pay there will always be lots of options to chat without ads. I hate to think what they and others might come up with to try and thwart this.
I think ads will take the form of insidious but convincing product placement invisibly woven into model outputs. This will both prevent any blocking of ad content, and also be much more effective: after all, we allude to companies and products all the time in regular human conversation, and the best form of marketing is organic word-of-mouth.
I just saw a sibling post about Kagi, maybe this is how the industry will end up, with a main provider like OpenAI and niche wrappers on top (I know Kagi is not just a google wrapper but at least they used to return google search results that they paid for).
I thought you were going to say “that comment recommending Kagi is exactly what those ads would look like: native responses making product recommendations as if they’re natural responses in the conversation”
That is a weird definition of advertising. It's not an ad if I mention (or even recommend) a product in a post, without going off-topic and without getting any financial benefit.
The New American Oxford Dictionary defines "advertisement" as "a notice or announcement in a public medium promoting a product, service, or event." By that definition, anything that mentions a product in a neutral light (thereby building brand awareness) or positive light (explicitly promotional) is an ad. The fact that it may not be paid for is irrelevant.
A chatbot tuned to casually drop product references like in this thread would build a huge amount of brand awareness and be worth an incredible amount. A chatbot tuned to be insidiously promotional in a surgically targeted way would be worth even more.
I took a quick look at your comment history. If OpenAI/Anthropic/etc. were paid by JuliaHub/Dan Simmons' publisher/Humble Bundle to make these comments in their chatbots, we would unambiguously call them ads:
Precisely; today Julia already solves many of those problems.
It also removes many of Matlab's footguns like `[1,2,3] + [4;5;6]`, or also `diag(rand(m,n))` doing two different things depending on whether m or n are 1.
(for the sake of argument, pretend Julia is commercial software like Matlab.)
> Name a game distribution platform that respects its customers
Humble Bundle.
You seem like a pretty smart, levelheaded person, and I would be much more likely to check out Julia, read Hyperion, or download a Humble Bundle based on your comments than I would be from out-of-context advertisements. The very best advertising is organic word-of-mouth, and chatbots will do their damndest to emulate it.
I don’t know how subtle or stealth you can be in text. In movies, there’s a lot of stuff going on, I may not particularly notice, I’m going to notice “Susie, while at home drinking her delicious ice cold coca-cola….”
> I’m going to notice “Susie, while at home drinking her delicious ice cold coca-cola….”
It will be much more subtle. Asking an LLM to help you sift through reviews before you spend $250 on some appliance or what good options are for hotels on your next trip…
Basically the same queries people throw into google but then have to manually open a bunch of tabs and do their own comparison except now the llm isn’t doing a neutral evaluation, it’s going to always suggest one particular hotel despite it not being best for your query.
Not all answers are conducive to such subtle manipulation, though. If the user asks for an algorithm to solve the knapsack problem, it's kind of hard to stealthily go "now let's see how many Coca Colas will fit in the knapsack". If the user asks for a cyberpunk story, "the decker prepared his Microsoft Cyberdeck" would sound off, too.
Biasing actual buying advice would be feasible, but it would have to be handled very carefully to not be too obvious.
Right, I just don’t see how it can be subtle, maybe it will be the opposite where I assume things are ads that aren’t, but any time I see a specific brand or solution I will assume it’s an ad.
It’s not like a movie where I’m engrossed by the narrative or acting and only subliminally see the can of coke on the table (though even then)
Maybe image generation ads will be a bit more subtle.
You have no guarantee the API models won’t be tampered with to serve ads. I suspect ads (particularly on those models) will eventually be “native”: the models themselves will be subtly biased to promote advertisers’ interests, in a way that might be hard to distinguish from a genuinely helpful reply.
> You have no guarantee the API models won’t be tampered with to serve ads. I suspect ads (particularly on those models) will eventually be “native”: the models themselves will be subtly biased to promote advertisers’ interests, in a way that might be hard to distinguish from a genuinely helpful reply.
I admit I don't see how that will happen. What are they gonna do? Maintain a model (LoRA, maybe) for every single advertiser?
When both Pepsi and Coke pay you to advertise, you advertise both. The minute one reduces ad-spend, you need to advertise that less.
This sort of thing is computationally fast currently - ad-space is auctioned off in milliseconds. How will they do introduce ads into the content returned by an LLM while satisfying the ad-spend of the advertiser?
Retraining models every time a advertiser wins a bid on a keyword is unwieldy. Most likey solution is training the model to emit tokens represent ontological entries that are used by the Ad platform so that "<SODA>" can be bid on by PepsiCo/Coca-Cola under food > beverage > chilled > carbonated. Auction cycles have to match ad campaign durations for quicker price discovery, and more competition among bidders
More akin to something like the twitter verified program where companies can bid for relevance in the training set to buy a greater weight so the model will be trained to prefer them. Would be especially applicable for software if azure and aws start bidding on whose platform it should recommend. Or something like when Convex just came out to compete with depth of supabase/firebase training in current model they could be offered to retrain the model giving a higher weight to their personally selected code bases given extra weight for a mere $Xb.
Companies pay for entire sports stadiums for brand recognition. That’s also not something you can change on the fly, it’s a huge upfront cost and takes a significant effort to change. That doesn’t stop it from happening it’s just a different ad model.
Companies will pay OpenAI to prioritize more of their content during training. The weights for the product category will now be nudged more towards your product. Gartner Magic Quadrant for all businesses!
Google realized this a long time ago; there is no ad-free paid version of Google Search.