Introduction to Perplexity’s Expansion
Perplexity, a search-focused AI startup, is taking a different approach to expanding its user base. While OpenAI has established itself as a leader in the U.S., Perplexity is focusing on the Indian market to gain a foothold in the next phase of AI adoption. By partnering with major Indian companies, Perplexity is rapidly adding millions of users in the world’s second-largest internet and smartphone market.
Partnership with Bharti Airtel
This week, Perplexity announced a partnership with Bharti Airtel, India’s second-largest telecom operator, to offer a free 12-month Perplexity Pro subscription to all 360 million Airtel subscribers. This deal is exclusive, meaning no other telecom company in India can offer Perplexity’s services to their subscribers. The partnership is a significant move in Perplexity’s global expansion strategy, which includes partnerships with over 25 telecom companies worldwide.
Growth in the Indian Market
Perplexity is already gaining traction in India, with its downloads surging 600% year-over-year to 2.8 million in Q2, according to Sensor Tower data. In comparison, OpenAI’s ChatGPT saw a 587% increase in downloads, reaching 46.7 million in the same period. The growth trend also extended to active users, with Perplexity’s monthly active users (MAUs) increasing by 640% year-over-year in Q2, while ChatGPT’s MAUs grew by 350%.
Leveraging India’s User Base
Perplexity has been working to leverage India’s user base to leapfrog Western markets, where OpenAI dominates paid subscribers. Earlier this year, Perplexity partnered with the Indian fintech giant Paytm to offer access to its AI-powered search through the Paytm app, which has over 500 million downloads. Perplexity CEO Aravind Srinivas has also taken direct steps to expand in India, including plans to hire an Indian executive and investing $1 million in a group building AI in India.
Challenges and Opportunities
Monetizing the large user base in India remains a challenge for Perplexity. The startup still lags behind ChatGPT globally in terms of revenue, despite offering the same $20-per-month starting price. However, there are promising signs, with ChatGPT seeing an 800% year-over-year increase in in-app purchases to $9 million in India in Q2. Strategic partnerships in markets like India could help Perplexity catch the eye of investors who value user growth and geographic diversification.
Conclusion
In conclusion, Perplexity’s expansion into the Indian market is a strategic move to gain a foothold in the next phase of AI adoption. By partnering with major Indian companies and leveraging the country’s large user base, Perplexity is positioning itself for mass-market scale. While monetizing the user base remains a challenge, the startup has room to expand its paid subscriber base through India. With the right strategy and execution, Perplexity can turn its expanding user base into revenue and establish itself as a major player in the AI market.
