ChatGPT ads are almost here. Why are people surprised that ChatGPT will run ads? It was always the endgame. It just came a bit early.
Now that the news has fizzled down, I’ve been wondering why so many people were surprised by the fact that another startup/app from Silicon Valley will be running ads.
It’s a running joke that everything out of Silicon Valley is made to run Ads. Let me break down the case for ads in ChatGPT.
- ChatGPT has a market valuation of over $500 billion dollars, and they were aiming for a 1 trillion dollar IPO (Before Google started shattering their dream).
- Their annualized revenue in 2025, as per Yahoo Finance, was $20 billions, but they were constantly operating in the red with heavy losses.
- OpenAI is slated to run out of cash in 2027 without future fundraising.
- Finally, the one that hits the nail on the coffin is that as of July 2025, only 5% of weekly active users were paid customers.
Under these circumstances, the only ethically and financially feasible option for them generate revenue is to run ads, as is the case with all other technocligical marvels that have come out of Silicon Valley in the past.
- Some historical context:
- Google did not search only
- Facebook did not stay social only
- YouTube did not stay creator-funded
- They all converged on advertising because advertising is the only mechanism that:
- Scales with users
- Scales with time spent
- Scales with intent
OpenAI, the maker of ChatGPT, says it will ensure that GPT’s responses remain objectively useful and not affected by advertising, and that conversations and data will remain confidential and secure, not shared with advertisers. Finally, it will also give users an option to turn off personalization if they want to.
As Gary Vee once said, privacy is the cost of convenience. If you turn off personalization, should we expect less relevant ads and slightly more inconvenience?! (Yes)
The one positive thing that stood out to me from their press release was the fact that they boldly declared that, despite them embracing advertising, they “do not optimize for time spent in ChatGPT. We prioritize user trust and user experience over revenue.”
The ads will be trialed in the USA across free and the $8/monthly Go plans (channels) and will show a relevant sponsored product or service at the bottom of the current conversation (placement). Users can interact to either learn more (CTA) or dismiss the suggestion. The ads will be clearly labeled as a paid solution to be distinct from ChatGPT’s organic answers. Users under 18 will not be displayed ads, and sensitive and regulated topics such as health, mental health, and political conversations will not be eligible placements.
ChatGPT’s road map includes plans to allow users to have conversations within the ad and make purchase decisions (convenience?) Exciting!
Paid Media Specialists across the world await more details and to get their hands on the platform. Meanwhile, learn how to prompt like a pro here.