Study: ChatGPT ad revenue hard-pressed to cover the cost of free access
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A working paper by Kaiser and Schulze evaluates whether ChatGPT ads can support free access, concluding that current ad performance is insufficient to cover the cost of free access. The study is based on data from 1,898 online stores with combined annual sales of $16 billion, examining the effects of ChatGPT's phased international rollout of ads. After ads launched, organic referral volume from ChatGPT fell by about 6% to 8%, while conversion rates remained essentially unchanged. Paid ChatGPT access generated $0.89 in revenue per session, lower than the $2.45 for paid Google Search. The authors therefore argue that, at this stage, ad revenue cannot fund free access.
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- Hacker News AICan Advertising Fund Free AI? Evidence from ChatGPT's Advertising Rollout
This working paper uses data from 1,898 online shops to test whether advertising can fund free AI access during ChatGPT's staggered international rollout, with the EU untreated. Ads moderately reduced organic ChatGPT referral volume (about 6–8%) but not conversion, while paid ChatGPT visits generated $0.89 revenue per session versus $2.45 for paid Google Search, a 64% shortfall. The authors conclude current ad performance is not sufficient to finance free access costs.
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