Jeff Bezos-backed Perplexity AI is gearing up to introduce "native" ads in its service, joining the ranks of Alphabet Inc.'s Google which initially believed search should be free of advertisements.
What Happened: Perplexity, a self-proclaimed competitor to Google, is preparing to roll out native ads, reported Adweek.
The company, which recently secured a $73.6 million Series B funding round led by Amazon.com Inc. founder Bezos, plans to incorporate ads into the related questions it suggests to users.
Perplexity’s AI-driven search engine, which responds based on web sources, videos, images, and data from partners like Yelp, will begin introducing native ads in the upcoming quarters.
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The company’s chief business officer, Dmitry Shevelenko, stated that these ads will be influenced by brands.
Despite its initial stance against advertising, Perplexity has always planned to incorporate it into its business model. The company, founded by AI researchers from Meta and OpenAI, currently charges a $20 monthly subscription fee.
Perplexity AI co-founder Aravind Srinivas quipped "Old wine in a new bottle," referring to Google co-founders Larry Page and Sergey Brin's comments during the early days of Google, where they criticized advertising in search engines.
The company claims to have over 10 million monthly active users, but it will need to ensure that its sponsored questions are relevant to maintain advertiser interest.
Why It Matters: Perplexity’s decision to introduce native ads comes amid its rapid rise in the AI industry.
The company, which is reportedly in talks to secure additional funding at a valuation significantly higher than its previous round, has been touted as a potential replacement for traditional search engines like Google.
Kubernetes developer Kelsey Hightower predicted that Perplexity AI could replace search engines like Google. The introduction of native ads could further solidify Perplexity’s position as a major player in the search engine market.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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