When people type a question into Confusion, the two-year-old search engine scours the web and uses data from multiple sources, including online publishers, to synthesize an answer using artificial intelligence. The company announced Tuesday that soon, Perplexity will begin sharing revenue with some publishers as part of its advertising platform, which it plans to launch in late September.
The initiative, known as the Confusion Publishers Program, comes less than two months after the $3 billion San Francisco-based startup, backed by investors such as Jeff Bezos and NVIDIA, faced criticism. Forbes, Wiredand Condé Nast A file type used by websites to block bots from crawling the page, allegedly to scrape unauthorized content and ignore robots.txt.
Among the first partners of confusion TIME, Luck, Texas Tribune, Der Spiegel and Automattic, the company behind WordPress.com. It’s unclear how much revenue Perplexity will share with publishers. The company’s chief business officer, Dmitry Shevelenko, declined to disclose the numbers, but told Engadget that it’s a “meaningful double-digit percentage shared with publishers who provide responsive source information.” “We’ve been talking to publishers since January,” said Shevelenko, repeating how it hasn’t been for several years.
There have been publishers around the world for months worried About the potential of AI-powered search engines and chatbots to simply reduce traffic swallowing their contents and uses it to reply directly instead of visiting people’s websites. Google followed suit – the company sources now provides answers from search results and displays AI-generated versions at the top of the page. However, it still does not compensate the publishers.
“[Our revenue share] This is certainly much more than Google’s revenue share with publishers, which is zero,” said Shevelenko. “The idea here is that we’re making a long-term commitment. If we’re successful, publishers will be able to create this ancillary revenue stream.” Confusion is the first AI-powered search engine to include citations to sources when it launches in August 2022, he said, although the company is said to have been redesigned user interface to display them more prominently after being called by Forbes in June.
AI companies like OpenAI have struck deals with major publishers as well TIME, News Corp, Vox, Axel Springerthe Financial Times and others will use their content to train AI models, writing checks ranging from $5 million to $250 million. And Perplexity’s revenue sharing program is different: instead of writing big checks to publishers, Perplexity plans to share revenue every time a search engine uses their content in one of its AI-generated answers. Below each answer in the search engine is a “Related” section, which currently shows additional questions that users can ask the engine. When the program launches, Perplexity plans to allow brands to pay to display specific follow-up questions in this section. Shevelenko told Engadget that the company is also exploring more ad formats, such as displaying a video section at the top of the page. “The basic idea is that we run ads for brands that target certain categories of queries,” he said.
This makes sense for Perplexity because it doesn’t train its own AI models. Instead, it allows users to choose from leading AI models such as OpenAI GPT-4oAnthropic Claude 3.5 Sonnet and Meta Llama 3.1 to summarize responses from the web. “It’s very simple,” Shelevenko said, “if we’re making money and the publisher’s content is used for that ad impression, the publisher will get a cut of that revenue.”
But without knowing what percentage of Perplexity’s ad revenue it plans to share with publishers, it’s unclear whether the move will help publishers recoup any revenue lost due to reduced traffic as AI-powered search engines and chatbots become more popular. Breaking into the online advertising business dominated by Google and Meta is not easy. “Building an advertising business takes time,” Toshit Panigrahi, founder of Tollbit, a startup that allows publishers to monetize content by offering it to AI companies for a fee they can set, told Engadget. “Publishers are expected to deliver content today that Perplexity is building a successful ad business and cutting them off.”
Shevelenko declined to comment on recent disputes Perplexity has been dealing with publishers, but acknowledged that it has become more difficult to get them to work in the past few months. “Some of them [of our conversations] they were in a great place,” he said, “then the bad press hit, and then they raised more questions.”
