OpenAI Opens ChatGPT Ads to Magnite and PubMatic Buyers

Buying an ad in ChatGPT is about to look more like buying any other ad on the internet. OpenAI has signed agreements with Magnite and PubMatic, two of the largest sell-side advertising platforms, to sell unused ad space in ChatGPT, The Information reported on Monday, 2 November, citing people familiar with the deals. Neither deal has been formally announced.

Under the arrangements, advertisers can use Magnite's and PubMatic's existing software to set budgets, place bids and upload their ads, according to Investing.com's account of the report. OpenAI's own system still controls where and how ads are shown. An OpenAI spokesperson told The Information the tie-ups make it "easier for advertisers to buy and manage ChatGPT ads through tools they already use."

Volumes running through the two platforms are small for now, but the people involved expect them to grow quickly, the report said. Investors liked it: Investing.com put both stocks up about 5% in early Monday trading, and Seeking Alpha reported gains of about 13% for Magnite and nearly 10% for PubMatic.

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From one door to many

Until now, most ChatGPT ads have been bought through OpenAI's own self-service Ads Manager or a short list of technology partners. The new deals add to earlier tie-ups with Criteo, LiveRamp, StackAdapt and Amazon Ads. OpenAI has also lowered its ad prices and added conversational formats that let users ask a sponsor's brand questions in text, according to the reports.

Sell-side platforms such as Magnite and PubMatic sit between publishers and the many buying tools that agencies use, so plugging into them puts ChatGPT's spare inventory in front of a far larger pool of buyers. The reports do not say how revenue is split between OpenAI and the two companies.

Advertising is becoming a large business for OpenAI. The ad unit reached a $1 billion annualised revenue run rate in August, up from $100 million in March, and OpenAI says more than 100,000 advertisers have run campaigns since ads launched in the US in February, CNBC reported in October. On 21 October, OpenAI extended ChatGPT ads to 89 countries, including Nigeria and South Africa.