OpenAI’s introduction of an ad-free search engine in ChatGPT could intensify competition in the search industry, where generative AI is already creating significant shifts.
Why It Matters
The global search industry is valued at over $200 billion, largely fueled by ad revenue, with Google claiming the vast majority of this. By adding search to ChatGPT, OpenAI challenges this model, offering an alternative approach that bypasses traditional ad-centric revenue.
Key Development
OpenAI recently embedded a search engine directly into the ChatGPT app and website. Currently available to individual and team subscribers, this feature is expected to roll out soon to educational and large business clients and eventually to free-tier users as well.
A New Way to Search
This move aligns with a broader trend where AI-powered chatbots are starting to replace traditional search engines by summarizing and personalizing information. As more companies introduce AI-based search tools, the landscape could shift even further. New players, as well as established ones like Google, are exploring ways to deliver AI-enhanced search experiences, from tailored summaries to direct answers.
Unlike Google, which returns a list of links, ChatGPT’s search tool gives users direct answers in a conversational format, which can be refined or customized. For example, ChatGPT can recommend results that are based on personalized follow-up questions, offering a level of tailored guidance far beyond traditional search results.
How It Works
ChatGPT’s integrated search feature is accessed via a globe icon on ChatGPT’s interface, whether on desktop or mobile. It draws on real-time data to answer queries where up-to-the-minute information is valuable. These answers are presented in ChatGPT’s familiar style, but with the option to include elements like maps or stock charts.
Despite being ad-free for now, Ghergich notes that consumer demand may ultimately lead to sponsored links, as users often want the ability to transact directly through search recommendations. If advertisers start adding sponsored links, it could open new revenue streams for OpenAI while giving consumers actionable results.
Potential Impact on Businesses
For businesses, the shift to AI-driven search introduces a new level of unpredictability. SME's compare this to the early 2000s when Google transformed search from a directory-based approach to a search-based system, impacting how businesses interacted with consumers. Companies may need to rethink their data-sharing and marketing strategies as AI-driven search evolves.
Similar to the transformation seen in car buying, where consumers arrive more informed, AI search will likely empower users with well-curated, relevant information before making purchases. However, as search becomes less reliant on link-based results, online businesses may face challenges in understanding how to navigate AI-driven traffic.
Content Publishers’ Concerns
While ChatGPT search cites its sources and provides links, it may not generate the same level of traffic as traditional search engines, which significantly impacted news and content websites. OpenAI collaborates with some publishers, but others might not benefit as much from AI-powered traffic if their content isn’t consistently surfaced.
SME's acknowledge that publishers have been struggling with ad revenue for years and will likely face further complications as AI reshapes content distribution.
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