Start-up began scaling back marketing effort last year
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Image: Perplexity
AI start-up Perplexity has reportedly decided to halt its advertising efforts. Unlike its competitors, who are embracing ad-based models, Perplexity is worried about the possible impact on users’ trust in AI applications.
According to a report by the Financial Times, Perplexity began phasing out adverts at the end of last year. While the company’s core mission remains unchanged, it has become aware of a shift in user perception. The FT cited executives at the company who said they were committed to “delivering accuracy” and providing “truth and the right answers”.
Initially, Perplexity experimented with adverts in 2024, displaying sponsored responses beneath the chatbot’s results. Despite clear labels and assurances that ads did not affect the answers, one of the company’s managers expressed concern that adverts could lead users to question the reliability of all information provided by the chatbot.
Although the possibility of reintroducing adverts in the future has not been ruled out, Perplexity is currently giving priority to user needs over revenue generation. The focus is on emphasising quality and building trust: “A user has to believe this is the best possible answer in order to keep using the product and be willing to pay for it.”
The decision reflects the rising training and operating costs associated with large language models. Many competitors have turned to adverts as a way of generating additional income. OpenAI, for example, is testing adverts in the free version of its ChatGPT chatbot, Google is integrating adverts into AI-powered search functions, and Anthropic has committed to keeping its Claude chatbot ad-free.
Some providers keen to avoid widespread advertising have resorted to increasing subscription prices.
Business AM