The news: Meta will launch a standalone Meta AI chatbot app during the second quarter this year, per CNBC reporting, to better compete with leaders like ChatGPT and Gemini.

• A paid subscription service for Meta AI is also reportedly on track for testing in Q2, per Reuters, similar to OpenAI’s ChatGPT and Microsoft’s Copilot offering paid access for more powerful versions.
• CEO Mark Zuckerberg announced in January Meta’s plan to reach 1 billion Meta AI users by the end of the year. A standalone app will ideally allow Meta to achieve Zuckerberg’s goal of being the leading AI service.

Where Meta AI stands:

• While directly comparing Meta AI usage with competitors is challenging because it isn’t available as an individual app, it’s estimated that Meta AI produces under 10 million monthly views, “far below major services (ChatGPT, Gemini, etc.) and even lower than some mid-range players like Anthropic,” per Business of Apps' data editor David Curry.
• However, the company is heavily investing in its AI infrastructure. Meta recently purchased 600,000 Nvidia H100 graphics cards to train its massive AI models and plans to spend between $60 and $65 billion this year to expand its AI reach.
• A standalone app could emphasize Meta’s AI as a powerful ad vehicle, increasing its already massive ad revenues—which accounted for nearly 98% of its overall revenues in Q1 2024.

Our take: Twenty-nine percent of marketers worldwide currently use chatbots and conversational AI platforms, and this number is likely to increase, giving Meta a large potential market to tap into.

• While Zuckerberg’s goal of surpassing the success of services like OpenAI and Gemini might seem unlikely—especially by the end of the year—Meta has billions of users, and it likely won’t take much to convince them to interact with Meta AI on the apps they already use.
• Part of Meta’s current issue is that it isn’t widely viewed as an AI platform like ChatGPT and Gemini are, but a standalone app could potentially address this. However, if it wants to achieve widespread user adoption, Meta needs to think strategically and find ways to incentivize users to choose Meta AI over its competitors.
• Without a unique advantage that the competition doesn’t offer—like integrating augmented reality into conversations and building virtual worlds based on conversations to step away from a solely text-based app—a standalone app might miss the mark.