After announcing a strategic alliance with SoftBank in April, Perplexity, the AI search engine aiming to compete with Google, is leveraging the partnership to expand its user base and data touchpoints in SoftBank’s native market. SoftBank, along with two of its mobile services, Y!mobile (SoftBank’s mobile operator) and LINEMO (SoftBank’s budget-friendly mobile network carrier), intends to provide complimentary one-year subscriptions to Perplexity’s premium tier, Perplexity Pro, starting June 19.
This development highlights Perplexity’s global aspirations and its emphasis on generating revenue from its premium tier, as well as the strategies of companies like mobile carriers. These carriers may lack the resources or inclination to develop their AI models and services but see partnering with AI firms as a means to attract users interested in AI, potentially increase customer numbers and revenues, and explore collaboration opportunities on AI-related services. This approach mirrors deals struck by companies like Spotify with mobile carriers during its early stages to grow its premium user base.
Perplexity isn’t only collaborating with SoftBank; it also formed a partnership with Deutsche Telekom in Germany, announced concurrently with the SoftBank deal in April 2024.
While it’s unclear if either carrier is investing in Perplexity through this agreement, SoftBank has prioritized AI in its strategic plans. The Vision Fund has shown interest in several AI startups, though no official investments have been made yet. Moreover, SoftBank’s founder, Masayoshi Son, is pursuing a $100 billion AI chip venture, and the company has been linked to a potential acquisition of Graphcore in the UK.
In addition to its investment activities, SoftBank’s Japanese division introduced its Japanese-language Large Language Model venture, SB Intuitions, last year. Perplexity Pro allows users to select their preferred LLM to power their search queries, enhancing their search capabilities with comprehensive information and data processing.
In April, Perplexity secured $62.7 million in funding, doubling its valuation to $1 billion within three months. Reports indicate it is seeking additional funding of at least $250 million at a valuation between $2.5 billion and $3 billion. Investors in Perplexity include Bezos Expeditions, IVP, NEA, Sequoia, Nvidia, Databricks, and notable individuals. The platform, available on web browsers and applications, generates responses based on recent web searches and is addressing concerns from publishers regarding proper credit in answers through revenue sharing agreements.
Perplexity Pro, a subscription-based offering, grants access to advanced features such as diverse LLM options for enhanced searches, image generation based on search history, and AI-driven customization of search results with chat-based support. The iOS app is priced at 3,000 yen monthly and 30,000 yen annually, while web version subscriptions cost $20 per month or $200 per year as of the same date.
