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The real revenue opportunity for OpenAI is advertising. More than 25% of Americans use ChatGPT instead of Google, and OpenAI has already announced partnership with Shopify to directly list products. But for now they are focused on market share.

Google does not really own the complete AI stack, NVDA is extracting a lot of the value there.

Google has two other impediments to doing what ChatGPT does.

Googles entire business model is built around search. They have augmented search with AI, but that is not the same as completely disrupting an incredibly profitable business model with an unprofitable and unproven business model.

Also... Americans are in the habit of going to ChatGPT now for AI. When you think of AI, you now think of ChatGPT first.

The real risk is we are at the tail end of a long economic boom cycle, OpenAI is incredibly dependent on additional funding rounds, and if we recess access to that funding gets cut off.

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I would argue that Google is even better place for advertising. All they need to do is enable advertising in Gemini. There is a whole ecosystem already in place for Google advertising.

Not that someone wouldn't try, but wtf would advertisements even be in ai chats but a giant distraction and interruption? (Moreso than web or video now). They are usually a call to link to something else.

I think it will be really sneaky. You ask for information and LLM will say "<product> does what you want and it is also cheaper with these additional features."

> Google does not really own the complete AI stack, NVDA is extracting a lot of the value there.

...not sure what you're implying.

Google most definitely has their own stack (spanning hardware-to-software) for AI. Gemini was trained on in-house TPUs:

https://www.forbes.com/sites/richardnieva/2023/12/07/google-...

Except Google search keeps growing per their last earnings report. You'd think if 25% of Americans have switched to ChatGPT it would have hit the numbers by now...

This surprised me as well, until I remembered how long it took advertisers to move from traditional advertising to the internet.

Even if you wanted to reallocate a significant portion of your advertising budget to LLMs, it's not clear how you would effectively do that and measure ROI.

We’re still in the period where people ask Google before reverting to ChatGPT. Wait until habits change.

For months now Google has provided AI results at the top of the page for every query, and quite frankly it’s really solid.

>Google does not really own the complete AI stack, NVDA is extracting a lot of the value there.

Google doesn't use Nvidia hardware at all except offering it to customers on their cloud offerings. They don't use it for training nor do they use it for inference.

Many people have a lot of context built up with ChatGPT. I know people who refuse to try Anthropic because it "doesn't know them as well" & can't answer their questions.

HN views this as negative but many people see this as a positive.

> Google does not really own the complete AI stack, NVDA is extracting a lot of the value there.

What are you saying..... Google is literally the only player that does not buy tons of Nvidia devices because they have TPUs.

I also believe the main business will be via APIs and integrations, but wouldn't be surprised on the consumer side if it ends up being on phones, in your house ala Alexa, in your car etc. Big brands typically win in B2C. Tons of affiliate and transactional potential (ie, do my grocery shopping or buy tshirt). That's assuming LLMs don't plateau and become generic with minor specialization like databases.

I don't believe that 25% quote, at all.

> Googles entire business model is built around search. They have augmented search with AI

No, it’s that Google Search doesn’t find anything anymore. You write a class name—it doesn’t index those anymore. So you revert to asking it a question about your bug, it’s no AI-fied enough. Perplexity and ChatGPT find what Google chose to stop indexing.

Google may be built around advertising, but certainly not around Search.