00:00 Speaker A
And there could be a big shift in AI business models, and it’s all about advertising. OpenAI is expected to generate $100 billion in advertising revenue by 2030, according to a new report from Axio. For more information, we welcome Dan Howley, Yahoo Finance Technology Editor.
00:18 Speaker A
Dan, I was reading these numbers and my first thought is, assuming OpenAI can retain customers after throwing all these ads at them, maybe they have some tricks up their sleeve. Please discuss this with us.
00:32 Dan Howley
Well, they’re currently experimenting with ads, but they’re pretty non-intrusive. It’s not like you’re going to get hit in the head with a pop-up or something. It’s similar to what you’d get on Google or something. They say this is a sponsored post or a sponsored article. Well, they don’t include it as part of the answer, like your direct answer. It’s like another thing that they end up showing.
00:54 Dan Howley
Well, I think people would still rather do that than pay for a service. I think a lot of the people who are paying money now are people who are genuinely interested in what AI can do. Maybe it’s building a web page or hiring an agent. But for the average person, I don’t think they’re willing to throw an extra $20 a month into something like this when they can just sit back and receive ads. I mean, the internet has been like that forever.
01:23 Dan Howley
Most models work this way. So I think $100 billion is obviously not a huge amount. Um, but it’s, I mean, we’ve got to see how they can do it, how they can sustain it, and how it can be used to pay back the huge expenses. Now they are moving into the enterprise space as well. That could be a huge revenue opportunity for them as well, but as you know, they have competition from Anthropic as well as Microsoft and Google. By the way, in the advertising space, we have Google, as well as Facebook, Meta, and Amazon. That means they’ll have to force their way in.
01:58 Dan Howley
Well, it’s one of the fastest apps ever released and you know what it does.
02:02 Speaker A
Well, Dan, I mean, it was the fastest app they ever released, but then all the competition came along, and some really good competition. And perhaps the next model, the Chap GPT-6, will steal the show and then return to the top. Maybe they will, but where is their moat now?
02:16 Dan Howley
I think the moat is that they had a really big first mover advantage. They, you know, it obviously doesn’t, oh, insulate them from anything. If you look at Microsoft, they had a first-mover advantage. Um, and now you see the stock price is way down. Well, there are people talking about how the co-pilot probably isn’t as good as something Anthropic could put together. Um, yeah, OpenAI, I think at the end of the day, what the latest model has is relevant to all of these companies.
02:44 Dan Howley
Now, I think it’s also worth noting that these models continually outperform each other. There’s going to be smarter people here, and, you know, this one’s smarter. And Google is currently getting all the accolades thanks to Gemini 3. As you know, that’s about to change. This is by no means one horse race. There is also no definitive leader at this time. We’ll keep watching them come and go. So I think Hori comes down to what can you do in addition to chat GPT, which is attracting a huge amount of attention.
