Perplexity sees India as a shortcut in its race ag...

Whereas OpenAI has cemented its lead within the U.S., Perplexity is taking a unique route — quietly increasing into India to compete within the subsequent section of AI adoption. The search-focused AI startup is quickly including hundreds of thousands of customers on the earth’s second-largest web and smartphone market, positioning itself for mass-market scale.

This week, Perplexity partnered with Bharti Airtel, India’s second-largest telecom operator after Reliance Jio, to supply a free 12-month Perplexity Professional subscription — usually value $200 — to all 360 million Airtel subscribers. Airtel confirmed to TechCrunch that the deal is unique, which means no different telco within the nation can provide Perplexity’s companies, together with free entry, to their subscribers.

The Airtel partnership is one among Perplexity’s most vital strikes but in a worldwide growth technique that features partnerships with greater than 25 telcos globally, together with these lately introduced with SoftBank in Japan and SK Telecom in South Korea. It comes all the way down to quantity. India, the world’s most populous nation, brings a mass market that the San Francisco-based startup won’t discover in different geographies.

Perplexity is already gaining main traction within the nation. In Q2, Perplexity’s downloads in India surged 600% year-over-year to 2.8 million, in line with Sensor Tower knowledge shared completely with TechCrunch. Compared, OpenAI’s ChatGPT noticed a 587% enhance, reaching 46.7 million downloads in the identical interval.

The expansion pattern prolonged to energetic customers as effectively: Perplexity’s month-to-month energetic customers (MAUs) in India elevated by 640% year-over-year in Q2, whereas ChatGPT’s MAUs grew by 350%. India was additionally the biggest market by MAUs for Perplexity within the final quarter, per Sensor Tower. Nevertheless, ChatGPT maintained a big lead in absolute numbers, with 19.8 million MAUs versus 3.7 million for Perplexity.

Constructing on earlier partnerships, Perplexity has been working to leverage India’s person base to leapfrog Western markets, the place OpenAI dominates paid subscribers. Earlier this yr, Perplexity partnered with the Indian fintech large Paytm to supply entry to its AI-powered search by way of the Paytm app, which has over 500 million downloads and is among the many top-three apps on the Indian government’s Unified Payment Interface community, processing over 1.2 billion transactions value over ₹1,34,000 crores (roughly $15.6 billion).

Perplexity CEO Aravind Srinivas has additionally taken direct steps to increase in India. In January, he introduced plans to hire an Indian executive within the nation, which he later placed on maintain after receiving an “overwhelming” response. He additional announced a $1 million investment and a dedication of 5 hours per week of his time to a gaggle constructing AI in India.

The startup has additionally internally mentioned providing its AI search engine to Indian college students to develop its attain, sources advised TechCrunch.

One cause Perplexity views India as a key development market is the comparatively limited number of local AI startups, significantly within the AI search area. On the similar time, the nation has a big and energetic base of tech-savvy customers — a proven fact that has even prompted Perplexity’s archrival, Google, to launch AI-powered search options like AI Mode and AI Overviews in India forward of many different markets.

Monetizing that giant person base stays a problem. Perplexity nonetheless lags far behind ChatGPT globally when it comes to income, whilst each provide the identical $20-per-month beginning value. In Q2, ChatGPT’s in-app buy income worldwide surged 731% year-over-year to $773 million, whereas Perplexity noticed a 300% enhance, reaching $8 million, per Sensor Tower.

The income problem is especially acute in India, the place customers are notoriously price-sensitive. Nonetheless, there are promising indicators. ChatGPT noticed an 800% year-over-year enhance in in-app purchases to $9 million within the nation in Q2. Perplexity has not generated any notable in-app income from India, however the startup has room to increase its paid subscriber base by way of India. Offers just like the one with Airtel might assist Perplexity successfully enhance its subscriber base, a minimum of within the brief time period.

Strategic partnerships in markets like India might assist Perplexity catch the attention of traders who worth person development and geographic diversification. However to show that spotlight into long-term backing, the startup might want to present that it could convert its increasing person base into income.

Srinivas didn’t reply to requests for remark.