Where does consumer AI stand at the end of 2025?

2025-12-29 · Source: a16z · Field: Technology & Digital — Artificial Intelligence & Machine Learning, Emerging Technologies & Innovation, Project & Product Management · Depth: Advanced, extended

Summary

In 2025, OpenAI's ChatGPT maintained a dominant lead in consumer AI with 800-900 million weekly active users, significantly outpacing Google's Gemini (35-40% of ChatGPT's scale) and other challengers like Claude, Grok, and Perplexity (8-10% usage). However, the latter half of the year saw rapid shifts, with Gemini's desktop users growing 155% year-over-year, compared to ChatGPT's 23%. Key viral models included OpenAI's ChatGPT-4 image and Sora 2 for video, and Google's Nano Banana and VO3.1 for image and video, respectively. While OpenAI integrated features into ChatGPT, Google often launched standalone products. Image and video models advanced significantly in realism and reasoning, with examples like Nano Banana Pro generating market maps and GPT Image 1.5 attempting multi-step reasoning tasks. Underhyped products included ChatGPT's Pulse and connectors, and Perplexity's Comet browser, which showed strong sustained traffic.

Key takeaway

For AI Product Managers and Entrepreneurs evaluating the consumer AI landscape, recognize that while large labs excel at model development and incremental core product improvements, they often struggle with opinionated, standalone consumer UI. Your opportunity lies in building focused, opinionated products that leverage advanced models, especially in multimodal applications, or by creating unique user experiences that address specific needs beyond text-in/text-out, as this is where startups can truly differentiate and capture power users.

Key insights

Consumer AI is rapidly evolving, with model quality enabling scalable applications and intense competition for user dominance.

Principles

• Best-in-class image/video models drive viral trends and user adoption.
• Product sensibility and intuitive interfaces are crucial for user engagement.
• Consumer AI products can achieve high revenue retention through usage-based pricing.

Method

No specific method is proposed, but the discussion highlights integrating search with image generation for accuracy and combining audio with video for viral AI video content.

In practice

• Explore Perplexity's Comet browser for an AI-native workspace.
• Utilize Gamma for text-to-slide deck generation.
• Try 11Labs Reader for converting written content to audio.

Topics

• Consumer AI Market
• Large Language Models
• Multimodal AI
• AI Product Development
• AI Startup Opportunities

Best for: AI Product Manager, Entrepreneur, Investor

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Editorial summary, takeaway, and curation by AIssential. Original article published by a16z.