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Comment by MontyCarloHall | Hacker News Reader

I also wonder if this means that even paid tiers will get ads. Google's ad revenue is only ~$30 per user per year, yet there is no paid, ad-free Google Premium, even though lots of users would gladly pay way more than $30/year have an ad-free experience. There's no Google Premium because Google's ad revenue isn't uniformly distributed across users; it's heavily skewed towards the wealthiest users, exactly the users most likely to purchase an ad-free experience. In order to recoup the lost ad revenue from those wealthy users, Google would have to charge something exorbitant, which nobody would be willing to pay.

I fear the same will happen with chatbots. The users paying $20 or $200/month for premium tiers of ChatGPT are precisely the ones you don't want to exclude from generating ad revenue.

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The average is $x. But that's global which means in some places like the US it is 10x. And in other less wealthy areas it is 0.1x.

There is also the strange paradox that the people who are willing to pay are actually the most desirable advertising targets (because they clearly have $ to spend). So my guess is that for that segment, the revenue is 100x.

"Lots of users would gladly pay way more than $30/year have an ad-free experience"? Outside of ads embedded in Google Maps, a free and simple install of Ublock Origin essentially eliminates ads in Search, YouTube, etc. I'd expect that just like Facebook, people would be very unwilling to pay for Google to eliminate ads, since right now they aren't even willing to add a browser extension.

It worked for YouTube, I don’t see why the assumption of paid gpt models will follow google and not YouTube, particularly when users are conditioned to pay for gpt already.

Anecdata, but my nontechnical friends have never heard of uBlock origin. They all know about ad-free youtube.

uBlock Origin specifically or ad blockers in general?

Surprisingly, ad blockers in general. And everyone (I know) hates ads.

I’d agree. The biggest exception I can think of is X, which post-Musk has plans to reduce/remove ads. Though I don’t know how much this tanked their ad revenue and whether it was worth it.

Why would it be any different for youtube premium? I think Google just doesn't think enough people will pay for ad-free search, not that it would cannibalize their ad revenue.

YouTube's ads are much lower-cost than the 'premium' AdWords ones, because the 'intent' is lower, and targeting is worse.

Pretty sure the reason they don't have a paid tier is because engagement (and results) is better when you include ads. Like Facebook found in the early days

Imagine if you are paying to publish an ad. One ad platform sends your ad to everyone, the other allows the most affluent users to avoid ads. If you choose the platform where affluent people won’t see your ad, you’re likely shooting yourself in the foot.

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