OpenAI's ad revenue could hit $25 billion by 2030

Analysts expect OpenAI's advertising revenue to surge over the next few years, driven by the potential of its flagship product, ChatGPT. According to a January 19 report from Evercore ISI senior analyst Mark Mahaney, OpenAI could theoretically earn around $25 billion a year from advertising alone by 2030. The bullish forecast rests on several key factors.

First, the analysts account for ChatGPT's potential scale by 2030. If OpenAI can hold and grow its market share, and ChatGPT keeps attracting users, the platform's ad reach will become extremely attractive to advertisers. Second, the forecast factors in the proven effectiveness of intent-based marketing platforms.

With a huge trove of data on user queries and interests, ChatGPT can offer advertisers unprecedented targeting capabilities, which would make ads significantly more effective. Today, OpenAI's main revenue source is subscriptions to ChatGPT Plus and other paid services. But the company is actively exploring ways to monetize its platform through advertising.

Last week, OpenAI announced plans to start testing ads with free users and Go subscribers in the US in the coming weeks. That move could be the first step toward a large-scale rollout of an advertising platform in ChatGPT. Bringing ads to ChatGPT could have major consequences for the digital advertising industry.

OpenAI could become a serious competitor to established ad giants such as Google and Meta. ChatGPT's unique targeting capabilities and massive user base could draw significant ad budgets. For users, this means the free version of ChatGPT may become more capable, but will also carry ads.

OpenAI needs to implement advertising unobtrusively and without degrading the user experience. Otherwise, users may abandon ChatGPT, which would hurt the company's revenue. Ethical questions also come into play.

OpenAI must ensure transparency and control over which ads users see, and protect their personal data. Misuse of that data could trigger backlash from users and regulators. In short, the $25 billion ad revenue forecast for OpenAI by 2030 is an ambitious but quite achievable target.

OpenAI's success in advertising will depend on many factors, including scaling ChatGPT, executing the ad platform well, and adhering to ethical standards. If OpenAI can pull this off, the company could become one of the key players in the digital advertising market.

*Meta is designated an extremist organization and banned in the Russian Federation.