OpenAI ad partner now selling ChatGPT ad placements based on “prompt relevance”

This approach makes a lot of sense. Advertising is a marketplace and this is a great way to bootstrap advertising inventory. Its inevitable they will allow advertisers to manage ad spend directly through OpenAI but right now the product is too new to capture meaningful ad budget. This way they can begin testing delivery and develop proof points around ROI and build towards larger ad spend directly.

>lower margins (more middlemen taking fees)

middlemen taking fees is not the measure for comparison, the question is whether you could run your own ad business for your own platform and keep your costs lower than established players who sell on all platforms. the answer is generally "no"

look how much money coca cola makes, and they sell it cheaper than water and still pay for advertising!! we should all make our own coke and not advertise it...

I agree with you, but IMO the details are too sparse here to figure out what's really happening. Still, it feels very dangerous to try to go the reseller route first as you lose a ton of control and become dependent on your partner to support all the feature you add yourself in a timely fashion.

I guess OpenAI couldn't train AdManagerGPT to ignore the client (except when it's time to renew), suggest more ad spend, and turn off any of the features that let you control your budget.

why would you be surprised about this? its pretty obvious that execs give no fucks except for money.

The missing part seems to be that they need infusions of money to keep this “business model” running a little longer. In this world if you want prompt money and lots of it, advertising is the way.

My guess is that three letter agencies will have access to this data and are requiring this partnership.

Maybe someone with more time at hands could look up what Google said with respect to ads and what happened later.

This is one of the rare instances where it's very easy to predict the future: the prompt auction market will look similar to the existing online ad market, financial firms will pay for prompt streams for sentiment analysis, companies and interest groups will pay to have their products or agenda included favorably in the training data for future open weights models... any way you can think of that LLMs can be monetized, you will see it happen. And fast. The financial pressure is way too high for there to be too long of a honeymoon phase like we had with web 2.0

In what way would that be securities fraud? I guess you could get nailed under Section 17(a), but really hard to make a case they're defrauding investors by representing they were going to make ads worse performing than they ended up making them.

In order for it to be securities fraud it has to be tied to a securities transaction and the misstatement has to be material to a reasonable investor's decision.

I think they said the ad vendors wouldn't but the matching algorithm would still be aware of it. Which IMO is the bare requirement to have ads be anything but magazine style ads.

I mean, the ad doesn’t necessarily have to be made aware of the exact prompt context, just that the ad itself was relevant. You can basically have the ads prequalified for areas and serve them when relevant. Now that does show the user is talking about something relevant most likely, and depending on how they decide to serve them or provide referring, it may traceable to a profile/identity built for that user externally.

I’d be more concerned as to how this ends up in agent platforms using the LLMs, when you don’t have a fairly autonomous agent based system using these the entire point is that a human isn’t involved, so who are you serving ads to and where are you injecting them.

Moreover, if you are injecting them everywhere, does that survive stare for subsequent steps, meaning from the first set of results I get, does that loop back in again with the ad injected into the context. Because now, we have yet another dangerous way of injecting instructions into an already issue prone surface area.

I’m guessing they’re going to have special APIs that don’t include ads, and those are going to cost more, especially for non embedded agents (processes that already exist inside ChatGPT that kick off transparently from prompts, like asking it to work with an office document). After all the customers using agents aside from developers are mostly businesses, so it’s where the money is. The ads will exist for the poor to subsidize their use, and probably create even more barriers for agentic use like I described. Just my thoughts.

And good luck litigating against any business in this administration. Unless they explicitly tick off certain people or refuse to kiss the ring, they can get away with almost anything right now and there’s little risk of doing it or not because ticking off this admin will raise illegitimate prosecution even if you’re perfectly legal, almost the same level of if you’re not. It’s the ideal playground for doing all sorts of manipulation, just kiss the ring and you’ll be fine.

Wouldn't it have to have a negative effect on the security to be securities fraud? Causing an investor loss is a key point of securities fraud.

"We made a ton more money with ads and the stock went up" lacks that key element of fraud?

who is "they"? might have been a stealth terms and conditions update

It would also be a huge security risk. But I can't think of any fundamental difference with Google queries, other than the sheer entropy of user data involved.

And I'm not a tinfoil internet anarchist, but just because Google only leaks user data in aggregated form to advertisers, doesn't mean that they don't leak their user data, it's just that they did so in a legal and responsible manner.

Maybe considering the difference in data volume and intimacy between queries and AI conversations, the privacy implications of advertising merit a difference in treatment, but I wouldn't be surprised if that is lost to a more simple 'Google did this so we can do it too' momentum.

Easy they lied to the public not investors and have more money than you.

Local llm or nothing at all.

Oh, given what I've seen from LLM companies, I suspect you are wrong. It will be more like:

Buried in LLM click-through: By interacting with our LLM, you agree that you are consenting to make all your interactions with us advertising-driven to an extent that you will never know, but that we will determine based on whatever makes us the most money in the least time.

Look at Google in 2000s. If you travel back in time you would’ve never thought Google would do something like it is doing today. Now pretend you travelled back in time to 2026. You would’ve never thought OpenAI (open source non profit company) would do something crazy that it just did in 2030 or 2040 or where you came from.

You think it will advise it is an ad. I’m hoping you are right but then again… Wonder if we will also be charged the token usage to generate said ad.

Imagine you have it coding for you and it injects and ad into your product.

Tbh it doesn’t even need that. Just a way for advertisers to say “I want to target people who have bought peanut butter in the last 2 weeks”(I’m a jelly seller). That alone would beat FB and Google.

ChatGPT is collecting your data fs so advertisers can go ultra niche targeting

Why do they call it Ovaltine? The mug is round, the jar is round. They should call it Roundtine.

This topic contains the most Reddit-like snark I think I've ever read here.

Also curious about this and how these agreements generally work

It happens as soon as they can't get more investments, up until now they could live on investment money but now they need real profits.

Theyre desperate to meet those lofty revenue objectives they put in their spreadsheet model.

Its kinda comical seeing this play out. I still laugh at the deluded fools who think something even close to AGI is here or coming in the future. If that were true, why haven't we seen genius plays from OAI and Anthropic, progressively over-time, if intelligence rises as compute scales up? If anything we are seeing the opposite.

If anyone from OpenAI is reading...

The very first time I see one of these ads, I'm cancelling my ChatGPT subscription. Measure _that_ metric in your A/B testing.

> I was becoming the kind of consumer we used to love. Think about smoking, think about Starrs, light a Starr. Light a Starr, think about Popsie, get a squirt. Get a squirt, think about Crunchies, buy a box. Buy a box, think about smoking, light a Starr. And at every step roll out the words of praise that had been dinned into you through your eyes and ears and pores.

Frederik Pohl, The Space Merchants

Kinda feels like America has already protyped the propaganda wave someone like Elon will try to unleash

Surely you jest? The software industry is in its current sorry state because of multiple generations of human developers happily producing an endless stream of shady features.

Maybe software needs an ethics union with the amount of control some of these systems have?

The opposite seems more likely, tbh.

Facebook was built before Claude Code existed.