Perplexity AI Plans to Roll Out Ads in Q4 Amid Surge in AI-Assisted Search

Perplexity AI, a rising star in the artificial intelligence landscape, has found itself at the center of controversy due to allegations of content plagiarism from prominent media outlets. Despite these challenges, the company is pushing forward with plans to monetize its AI-assisted search app by introducing advertisements in the fourth quarter of this year, according to information obtained by CNBC.

Perplexity AI has been gaining traction, with its app reportedly downloaded more than two million times and boasting an impressive 230 million monthly users. According to a pitch deck viewed by CNBC, the company has seen U.S. queries on its platform increase eightfold over the past year. This surge in popularity has not only drawn attention to Perplexity’s innovative search capabilities but also to the ethical concerns surrounding its content sourcing practices.

The company’s rapid growth has been accompanied by criticism, particularly over its handling of content from other sources. In June, *Forbes* reported finding a plagiarized version of one of its stories on Perplexity's platform, with only a small “F” logo at the bottom of the page as a vague attribution. This was followed by *Wired* uncovering similar instances of plagiarism, further exacerbating concerns. According to *Wired*, an IP address likely linked to Perplexity had accessed its parent company’s websites over 800 times within three months, raising red flags about the company’s methods of content acquisition.

In response to these allegations, Perplexity AI has made efforts to improve its content attribution practices. The company told CNBC that it updated its Pages feature to better cite sources and revised its system to ensure that media outlets receive more explicit credit within the generated content.

To address the growing concerns and foster better relationships with content creators, Perplexity AI introduced a revenue-sharing model in July. This initiative allows publishers to earn money through the company’s search engine by sharing a percentage of the ad revenue generated from their cited articles. Early participants in Perplexity’s "Publishers Program" include notable outlets like *Fortune*, *Time*, *Entrepreneur*, *The Texas Tribune*, *Der Spiegel*, and *WordPress*.

Dmitry Shevelenko, Perplexity’s chief business officer, explained in a July interview that publishers stand to benefit significantly from this model. If multiple articles from the same publisher are used in a single answer, the revenue share increases proportionately. Shevelenko emphasized that the company has been developing this feature since January, with the goal of enrolling 30 publishers by the end of the year.

Perplexity AI's forthcoming venture into advertising is a key component of its monetization strategy. According to a source familiar with the matter, the company plans to implement a CPM (cost per thousand impressions) model, with CPM prices expected to exceed $50. This is notably higher than typical rates, with desktop display ads usually around $2.50 CPM, and mobile video ads at approximately $11.10 CPM, according to a blog post by search marketing firm Semrush.

The company’s pitch deck outlines the initial focus for its advertising categories, which will include technology, health and pharmaceuticals, arts and entertainment, finance, and food and beverage. Advertisers will have the opportunity to sponsor "related questions" that appear below answers, and they can also purchase display ads positioned to the right of Perplexity-generated answers.

Perplexity AI's user base is characterized by a highly educated and affluent demographic. The pitch deck reveals that over 80% of users hold an undergraduate degree, with 30% occupying senior leadership positions and 65% working in high-income white-collar professions such as medicine, law, and software engineering. This demographic profile makes Perplexity an attractive platform for advertisers looking to target a sophisticated and influential audience.

The emergence of AI-assisted search tools like Perplexity AI is viewed by investors as a potential disruptor to traditional search engines, particularly Google. AI search technology offers a new way for consumers to access information online, challenging Google's dominance in the market. OpenAI, the company behind the groundbreaking ChatGPT, recently launched its own search engine, SearchGPT, while Google has responded with "AI Overviews" in its search results, providing quick summaries of answers at the top of the page.

Perplexity AI's journey is emblematic of the broader tensions and opportunities within the rapidly evolving field of artificial intelligence. As the company moves to monetize its platform through advertising, it will need to navigate the delicate balance between innovation and ethical content practices. The outcome of its current controversies, as well as its ability to maintain trust with users and content creators, will be critical in determining its long-term success in the competitive AI-assisted search market.