OpenAI's financial chief says the company is considering introducing an advertising model
It has been revealed that OpenAI, the provider of 'ChatGPT,' is considering introducing advertising as a new means of generating revenue. At the time of writing, it is unclear what type of advertising will be introduced.
OpenAI explores advertising as it steps up revenue drive
Ads might be coming to ChatGPT — despite Sam Altman not being a fan | TechCrunch
OpenAI denies it is building ad biz model into its platform • The Register
https://www.theregister.com/2024/12/02/openai_mulls_other_revenue_streams/
In an interview with the Financial Times, OpenAI's Chief Financial Officer, Sarah Frear, revealed that the company is 'considering an advertising model,' adding that 'we will be thoughtful about when and where to introduce it.'
According to the Financial Times, OpenAI plans to raise $6.6 billion in new funding in October 2024 and is poaching advertising executives from major tech companies such as Meta and Google.
In a statement after the interview, Furia said, 'Our business is growing rapidly and we see significant opportunities within our existing business model. While we are open to exploring other revenue streams in the future, we have no plans to actively pursue advertising,' suggesting that the company is considering the advertising business as 'one possibility.'
OpenAI is stepping up efforts to generate revenue from products such as its AI-powered search engine, leveraging its strength as an early adopter in the fast-growing AI field.
OpenAI announces AI search service 'ChatGPT search', appealing that there is no need to Google repeatedly - GIGAZINE
In May 2024, OpenAI hired Sivakumar Venkataraman, a veteran of the search advertising business who had worked at Google for 21 years, and in June, it brought in Kevin Weil, who was in charge of product and marketing at Instagram and X (formerly Twitter). Frear also said, 'Mr. Weil and I have extensive experience in the advertising business,' suggesting that OpenAI is steadily laying the groundwork for launching advertising.
However, in a public interview at Harvard University, OpenAI CEO Sam Altman said, 'Personally, I hate advertising. I think advertising was important in the business model of the early Internet, but I think companies are fundamentally wrong in aligning user incentives. I'm not saying that OpenAI won't consider advertising at all. I just don't like it. In addition, I have some reservations about combining AI and advertising. I see advertising as a business model of last resort.' So while advertising is an option, it is unlikely to be adopted as long as CEO Altman's wishes are respected.
OpenAI is working on improving its AI models, but due to the high cost of training them, it frequently raises funds to explore new ways to commercialize its technology. As of October 2024, it is known that it had raised approximately 970 billion yen.
OpenAI completes fundraising of approximately 970 billion yen at a valuation of approximately 23 trillion yen, Microsoft, NVIDIA and SoftBank may participate in the round - GIGAZINE
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