The poor economics of consumer AI: why Muse, Dots, and Instinct struggle to become profitable
The ugly economics of consumer AI
What happened
Consumer AI appears to be rebounding as Meta's Muse, OpenAI's Dots, and $10 billion-valued Instinct bet on personal agents, but willingness to pay is growing slowly. As of May, only 2.2% of consumers paid for AI, spending an average of $31 a month. AI operating costs are high, making profitability difficult even with hundreds of millions of paying users. OpenAI has shifted toward enterprise, where bookings have doubled since July.
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- 1Meta Releases Muse Spark Open With Mac and Cloud Support, Topping US Open-Weight Index
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- 4Meta’s New Business Terms Raise Dispute Over Website Crawling and AI Training Rights
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