OpenAI Freezes Ads To Sharpen ChatGPT's AI Core — Users Could See Major Changes

OpenAI is hitting the pause button on its advertising efforts. The company has temporarily halted all new ad campaigns to focus its resources on refining the core AI technology that powers its flagship product, ChatGPT.

This strategic shift signals a major internal commitment to enhancing performance and capability, and users should be prepared for significant upcoming changes to the platform experience.

Operation Code Red: Why OpenAI is Freezing Ad Revenue

Sam Altman, OpenAI's CEO, notified his workforce that he was initiating a 'code red' to boost ChatGPT's quality urgently. As a result, The Information reported on Monday, citing an internal paper, that the company will postpone different plans, notably its advertising campaign.

Consequently, a range of company ventures will now be put on hold. These include its marketing efforts, the AI agent feature (designed to automate jobs like shopping and health appointments), and Pulse, which focuses on generating individualised reports.

Though OpenAI has not officially confirmed any plans to sell advertisements, the same document mentions that the firm is already testing commercial features. According to an individual familiar with their strategy, these trial ads feature promotional content focused on online retail and product buying.

The Choice Facing ChatGPT Users

Under the present plan, individuals using the platform might soon be forced to make a difficult decision: keep the highly personalised AI interactions that rely on its memory feature, or deactivate the memory function to prevent being served specific, targeted advertisements.

This initiative marks OpenAI's first substantial effort to generate revenue from ChatGPT through advertising. Previously, the platform's financial model relied solely on premium services, such as the ChatGPT Plus subscription, and on agreements with corporate partners.

User Beliefs Drive Internal Push

Research from internal focus groups apparently uncovered an interesting user belief: some individuals already think that ChatGPT displays advertisements.

This misconception has emboldened certain OpenAI personnel—particularly former Meta staff, who now represent a substantial portion of the company's workforce—to argue in favour of formally adding paid promotions.

630 Former Meta Staff Lead the Ad Charge

The report specifies the scale of this recruitment: approximately 630 of OpenAI's 3,000 staff members are former Meta employees, who even have a private company channel on Slack.

A notable figure among them is Fidji Simo, the current CEO of Applications at OpenAI. Simo spent ten years at Meta, where she was key in rolling out advertisements on Facebook's main application.

She is now said to be leading the creation of a new group focused solely on weaving commercial promotions into ChatGPT, according to a StoryBoard 18 report.

A History of Scepticism

This initiative signals a new course for OpenAI, especially since the company's executive team has previously been wary of incorporating advertisements.

For example, during an interview with the Financial Times last December, Chief Financial Officer Sarah Friar said that while OpenAI was looking at all 'new revenue streams,' advertising was not an active project.

Sam Altman has also expressed mixed feelings about advertisements. Speaking on the Lex Fridman Podcast, he admitted he 'kind of hates ads just as an aesthetic choice.'

Although he conceded that promotions were vital to the internet's early development, he made it clear that he favoured a subscription system. Under such a model, he stated, 'users know that the answers they're getting are not influenced by advertisers.'

Not Totally Against It: The Path to 'Cool' Ads

Despite his personal reservations, Altman also admits that advertisements can be highly effective when executed properly.

In a separate interview earlier this year, he highlighted the system used by Instagram as a positive example, saying, 'I'm not totally against it,' he said. 'I think ads on Instagram are kind of cool—I've bought a bunch of stuff from them. But it would take a lot of care to get right.'