Perplexity CEO Aravind Srinivas smiles during an interview with The Korea Times in central Seoul, Wednesday. Korea Times photo by Shim Hyun-chul

Koreans are known for their lack of patience. They are also quick to try whatever is trending. This is why Perplexity — referred to as the "Google challenger" — selected Korea as a key market by partnering with the country's largest mobile carrier, SK Telecom.

Although most Koreans may be unfamiliar with the AI-powered search engine, Perplexity CEO Aravind Srinivas is confident that it has a chance here, despite the dominance of Google and the local portal Naver.

Perplexity, co-founded in 2022 by Srinivas, a former OpenAI researcher, draws content from the web to provide summarized answers with source links. It is known for its conversational style, as it generates follow-up questions. This mechanism enables the answers to become more accurate, which is why the CEO refers to the platform as an "answer engine" rather than a search engine.

With investments from big names including AI chip giant Nvidia and Amazon founder Jeff Bezos, the startup is now valued at $3 billion.

In the same way it has joined hands with SK Telecom, Perplexity is expanding its global reach in Japan and Germany through telecom companies that facilitate exposure to the relatively new platform.

"(Our ultimate aim is) to grow the market for answer engines, create innovative business models that are differentiated from other AI chatbots and serve everybody on the planet," Srinivas told The Korea Times in an interview in Seoul, Wednesday.

The CEO was here for a press conference with SK Telecom on the day. The latter has invested $10 million in Perplexity.

Challenging Google

The CEO's goal is to make Perplexity a "multi-headed monster," by which he means it should have various revenue streams.

"It's difficult, but when you have it, it's formidable," he said, referring to Google's lack thereof.

"Despite it being a trillion-dollar company today, it's so vulnerable because almost all of its revenue and profits are coming from one particular business — advertising."

Currently, Perplexity has three revenue mechanisms: subscriptions, APIs and enterprise. The fourth will be ads that will launch in the fourth quarter. Under this model, advertisers will pay for sponsored follow-up questions suggested on the platform. Stepping into the ad industry, the new player will compete head on with the behemoth Google.

Perplexity has a key advantage over its AI chatbot competitors. Licensing a combination of AI models from OpenAI and others saves a company the substantial costs of building its own.

It appears Perplexity is equipped for what it expects to be a showdown with Google. But the startup would not be called the "Google challenger" if the challenge was not truly challenging.

"Building a differentiated search experience is already hard, but getting 100 million users for it is even harder," Srinivas said.

"It's also difficult because of all the distribution deals Google has signed with Apple and Samsung and so many others. And these phones control most of the access points to search."

Perplexity CEO Aravind Srinivas, left, shakes hands with SK Telecom CEO Ryu Young-sang during a joint press conference at the SKT building in central Seoul, Wednesday. Yonhap

News partnerships

Ever since Perplexity launched its Publishers' Program in July, more than 100 entities have inquired about partnerships, with many of them joining, including Fortune and Time, according to the company.

Under this partnership, when the AI platform makes advertising revenue from a query that cited a source from a particular publisher, Perplexity shares the revenue with the publisher.

"This has never been done by a search engine. Search engines used the excuse that they are giving you traffic and they did not pay any revenue. Actually, they got all the revenue with the clicks," Srinivas said in the press conference with SK Telecom.

"Instead we are proposing a different approach in the AI world — the traffic will be lower but if we make revenue we will share it with you."

While the AI platform refers to news articles in its answers, Perplexity has no plans to launch a separate news section.

"News is a very small fraction of Perplexity's usage. They still come to the outlets because they are more reliable and trustworthy. But when people are looking for a summary of what's happened or old news in the context of what's going on, those are the kinds of things people come to Perplexity more for. So we don't see any angle where we are going to be the news provider to people," the CEO said.

Srinivas said the company will unveil its list of news partners but said Perplexity is "initially focused on getting it right in the American market."

Revenue sharing will be determined by the type of content — original content that is cited will guarantee revenue, but for the same content published by many news outlets, the AI program will determine which article will be cited, the CEO said.