Where Does Consumer AI Stand at the End of 2025?

0:00For most of the year, less than 10 % of ChatGPT users even visited another one of the big LLLM providers. When you open Gemini, it has a pop-up that says, we got a nano banana. Would you like to do something with it? A little pane where you have to type something. I don't know what to do. These are hot-up nuances that I think makes people actually take the first. The models have gotten to the level of quality that you can build a real scalable app on top of them. And so the hope is 2026 will be a huge year for consumer builders. As 2025 comes to a close, consumer AI is starting to look very different than it did at the beginning of the year.

0:37A small number of products now dominate everyday usage. New multimodal models have gone viral, and the big labs have pushed harder than ever into consumer experiences. To take stock of the year, the A16Z team, Anisha Charya, Olivia Moore, Dristeen Moore, and Brian Kim break down what actually worked in 2025 and what didn't. They discuss which model launches and interfaces change user behavior, why small product details matter more than raw model quality, and whether the consumer AI market is trending toward win or take most. The conversation also looks ahead to 2026, where there is still room for startups, how templates and multimodality are reshaping creation, and why this may finally be the moment when scalable consumer AI apps break out.

1:22Today, we're talking about who won consumer AI in 2025. This was arguably the year that we saw the big model providers, OpenAI and Google, most out of everyone, make a major push of their own into consumer, both in terms of new models they release, but also in terms of new products, features and interfaces that target the mainstream user. You might wonder, why does it matter who is in the lead here? There are some early signs that the general LLM assistance space might be trending towards winner take all or at least winner take most. So only 9 % of consumers are paying for more than one out of the group of ChatGPT, Gemini, Claude, and Cursor.

2:01And for most of the year, less than 10 % of ChatGPT users even visited another one of the big LLM providers like Gemini. If we had to call it now, ChatGPT is currently in the lead by far at 800 to 900 million weekly active users. Gemini's at an estimated 35 % of their skill on web and about 40 % on mobile. And everyone else significantly trails this. So Claude, Grok, Perplexity are all about 8 to 10 % of the usage. But especially in the last three to six months, things are changing very quickly. With the launch of new viral models like Nano Banana, Gemini is now growing desktop users 155 % year over year, which is actually accelerating even as they reach more scale, which is pretty crazy to see.

2:47And ChatGPT is only growing 23 % year over year. And we're starting to see players like Anthropic almost specialize within consumer, owning different verticals like the hyper-technical user. So today we've brought together the A16Z consumer team to recap what we saw this year from the big model companies in consumer and also to predict what might be ahead of us in 2026. Cool. Well, thank you, Olivia. It's been a super fun year. If we kind of wind the timeline back to last January, maybe we should start with what we saw, launches, products, what worked, what didn't. So Justine, tell us what you saw this year OpenAI, Google, what are you paying attention to?

3:22What have you changed your mind on? Yeah, those two in particular had a ton of consumer launches, like Olivia mentioned. From a model perspective, I would argue their most viral models this year, at least among consumers, were in image and video. So for OpenAI, it was the Chatt2BT 4.0 image, the Ghibli moment, which is crazy that that was this year. It seems like this is this year. It feels like it was years ago. And then Sora, obviously, Sora 2. And then for Google, it's VO, VO3 and VO3.1 and then Nano Banana and Nano Banana Pro in image models, which went insanely viral, probably comparable to if not beyond the Ghibli moment for OpenAI.

4:00I think in terms of the product layer, what we saw was OpenAI tended to keep more things in the ChatGPT interface. So like Pulse, group chats, shopping, research, tasks, all of these features launched inside ChatGPT as the core. The exception there is obviously Sora as a standalone video app, whereas Google tended to launch more things as standalone products. So they did ship a lot through like Google AI Studio and Google Labs and Gemini and the plethora of Google surfaces there are to launch a product. But they would also ship things as standalone websites that you could go to and visit, which basically allowed for a more custom interface for each type of product, not just the kind of chat entry, chat exit or image video exit.

4:46So just so you have a question for you on that. So it felt like 18 months ago we were talking about mid-journey and most of the multimodal models were defined by aesthetics. and realism. Is that still true? What changed this year? Yeah, I think there's definitely different styles still. And I think mid-journey, when you talk to people really deep in image and video, it still kind of stands apart for this like aesthetic sensibility that a lot of the models don't have if you don't know how to prompt for it. But I would say this year in particular, we made a lot more strides on realism and also on reasoning within both image and video.

5:19Like all of the little details that make an image or a video actually seem real. For example, if you have a person walking and talking, the people in the cars in the background, if they're on a street, should be moving in the correct direction, like they shouldn't be morphing and looking strange. In Image, we were able to have multiple input images and text and sort of reason across all of those uploads to create like a cohesive design or something like that, which was not something we saw happening last year for sure. Yeah, I remember when we We're excited about having a letter show up correctly in images.

5:52And now we have insane infographics. Yes. We can just put up an amazing YouTube video and say, give me an image that explains this. Yeah. That's incredibly different. Nano Banana Pro can even generate like market maps. You generated a market map. It's incredible. And it either has or will go do the web research within the image model, which is crazy to get the correct list of companies and then pull their correct logos. So what are you going to do now? Which is insane. I know. There's one benchmark left that the reasoning image models have not cracked. I tested GPT Image 1.5 yesterday. They sometimes struggle with both reasoning and multi-step reasoning.

6:25So what I've been testing is you upload a picture of a monopoly board and you say, remove the names of all the properties and replace them with names of AI labs and startups. And GPT Image 1.5 is actually the closest, but it's very hard for them to do all of those steps. Remove it, come up with the new names, put all of the new names in the correct places, make sure there's not overlaps or one thing you mentioned three times and another big player you never mentioned. So there's still some room to go on the image evals. And it's interesting that especially from the image model from ChatGPT where you can actually see perseverance of like it carries a character over into multiple image generation, the same style.

7:07Yeah. And I thought that was like, oh, like this is actually very interesting. We're storyboarding. Totally. Makes you want to generate more. Yeah. You know, for me, it felt like the most underhyped aspect of Nano Banana was the integration with search because it feels like there's realism, which is physics and sort of other things that feel like we're on Caney Valley. There is reasoning, which is apply modifications that are adherent to what the user asked for. But then there's also sort of accuracy. And for me, a good example of this is product photography. If you say, hey, generate a photo of this album cover or a historically accurate photo of this moment in time, you have to actually have the search integration.

7:43And that was sort of non-intuitive, but it's actually very useful. Totally. Yeah. It's kind of like the VO3 moment when I don't think it was intuitive to people that video would be cracked necessarily by bringing audio together with video in the same place. And that ended up being the thing that made AI video go viral. Yeah. Like since VO3, and now Sora maybe dominates, but like since VO3, my social feeds have been like full of really realistic looking AI video. I counted. About one-fifth of my feeds are AI generated. Amazing. Wow. What do you guys do? There's so many launches this year, and many of them went well, like Vio and Nano.

8:17What do you think is under-hyped or products that you think didn't get enough attention? Brian? It's a good question. I think under-hyped pulse of the world is probably still under-hyped, and we're talking about OpenAI, Google, which to me falls under productivity category. So if you actually think about, if you go to App Store today, top five out of top 10 productivity apps are all Google. It's insane. And ChatGPT is number one. So we're talking about a productivity category where it helps you do things. And I feel like a lot of people are trying this from a different angle. Like, how do I actually ingest your data or your schedule, your email to make it more helpful and give more proactive notification to you?

8:58I think a lot of people are working on it. Given the frequency of people using ChatGPT, which I think is, what, 25 times a week? Pretty good. Pretty good. Three to four times a day. it feels like it's a really good position to actually give you proactive nudges and summary and help your life in general. So I feel like the Everything app was always this myth in the Western world. I think OpenAI is trying to move in that direction where it's ingesting enough. People are going there enough to start giving really useful proactive nudges. And I think that's a space that I'm excited about. It's interesting.

9:34But are you a DAU? I am not a DAU. A Pulse? Well, not a false. Similarly, I tried Pulse for a while and have kind of largely turned off of it. But I would agree with you that I feel like Pulse and a couple other examples that OpenAI launched this year are kind of new primitives or ideas that feel underhyped. But because the execution is a little off. I think it's execution. The usage is off. Another example that I would give, which is similarly like personal contacts, would be their connectors. So now you can and you can do this on cloud as well. you can connect your calendar, your email, your documents.

10:07And so hypothetically, you could say to ChatGBT, you know, read all of my memos over the past six months and like summarize what's most interesting, least interesting. I think when that works, it's really exciting. I have found it to be a little bit unreliable so far, but I think as the models get better, they have a real chance to kind of own the prosumer workspace if they get that right. Prosumer is perfect category because we talk about it sometimes, but 99 % of people don't run their lives on calendar. Yeah, we do. Right. So that's what I'm thinking about, the actual average frequency of using ChatGPT.

10:39And look, if it's 24 times a week, that's a pretty good place to start. Yeah. Olivia, I feel like you are the ultimate power user. What are you still using? What's your stack? It's a great question. From all of the larger model companies, actually, I would have to say the thing that I'm still using the most and was maybe the most impressed by this year was the Perplexity Comet browser. And I don't and was not using Perplexity as my core general LLM assistant. I use ChatGPT and Claude much more. But I think they really executed on it in a first class way in terms of both the agentic model within the browser, but also perhaps more importantly, all of the workflows that you can set up that allow you to basically run the same task over and over, either at a preset time or when you trigger it on a certain web page.

11:26So that to me was a really exciting launch. And if you look at the data, like the spike at launch and the sustained traffic for Comet was actually much higher than for ChatGBT's own browser launch, Atlas, which is kind of crazy given how much more distribution ChatGBT has than Perplexity. But I think they also launched an email assistant this year, Perplexity did, and they made a couple acquisitions of really strong agentic startups. And so what I would love to see from them next year is like more of these dedicated prosumer interfaces. I feel like that would be an awesome direction for them to kind of double down in.

11:58They do feel like the startup that has the biggest breadth of ambition, you know, alongside the labs and sort of big tech. Like it's very, very impressive just the number of things they've shipped this year. Yes, definitely. One thing I wanted to ask you, Justine, was sort of Gemini feels like it's having a real moment because of all the image and video models. Do you think it can overtake ChatGPT? Is there truly that much demand for these types of models? I think, yeah. So what I've seen basically is there is always nearly infinite demand for like the best in class image or video model. Because then you have a mix of tons of different people seeing it and wanting to use it.

12:37You have, like if you're using it professionally, if you're marketing or in entertainment or storyboarding or whatever, you always want to be using what's at the forefront of the field. And so you're totally fine to go somewhere other than ChatGPT and Sora to get access to Vio. Even if you're an everyday consumer, so many new viral trends are created around new capabilities of the best in class image and video models. And so that ends up driving users into different products that they may have never tried before. Like you might be downloading the Gemini app or accidentally ending up on Google AI Studio, which I know they're trying to make be more for developers, to use Nano Banana Pro, which a lot of users, I think, experienced in the past couple of months.

13:19Yeah. The interesting thing about Gemini to me is like hypothetically they benefit from the massive Google distribution advantage. Like if you look at Android, Gemini is at like 50 percent of ChatGPT's scale on mobile, whereas on iOS it's like 17 percent. So like clearly something is working there. They launched a little Gemini widget within Chrome recently that encourages you to use it. They're launching it within Google Docs and Gmail and other things. Yeah. But I think that most the average person is still just using one AI product. And ChatGVT is like the Kleenex of AI. Like it is the brand that has become.

13:54The verb, the noun. Exactly. Yes, yes. And so I think that Gemini still has a pretty big hurdle to overcome. Yep. Just in terms of that. Yeah. But if they keep doing what they're doing on these amazing viral consumer creative tool launches and model launches, like they could get there next year. I'm thinking about this. It's really interesting when you look at Gemini, which is everywhere. Yeah. But yet nowhere to some extent. Right. You don't like, you know, when you look at the actual usage, people still think of the Kleenex. Yep. And they go to ChatGPT. But the interesting thing also is on the product sensibility.

14:30So this morning I had like two panes open, OpenAI's image model and Google's Gemini and basically use an image functionality. When you open Gemini, it's a blank screen. It has a pop-up that says, we got a nano banana. Would you like to do something with it? And a little pane where you have to type something. I don't know what to do. Chatting PT, you go in and it has a very TikTok-like style of like, here's a trending theme. that you might want to generate. And you click on, I want a sketch pen or whatever. And then just like use one other picture and it creates something amazing. And then it says, would you like a holiday card?

15:09Would you like a blah, blah, blah, blah, blah. These are product nuances that I think makes people actually take the first step. Yeah. To generate it. And then once you have it, you have character consistency. Yeah. So you keep going. Right. So that's interesting in that I think OpenAI and ChatGP team has proven that there is deeper product sensibility. Yeah. But then this is a funny thing, maybe a little non-cosher thing to say, but, you know, I worked at Snap. So when you look at Meta versus Snap, famously, Evan Spiegel was chief product officer of Meta. Yeah, yeah. I wonder if there's a world where the ChatGPT team that innovates on the product front again and again, Google with distribution looks at them like, that's cool.

15:52Let's just integrate it and keep going and actually play that game. The interesting thing there is that images pane just launched yesterday when we're filming this. In ChatGBT. In ChatGBT. Brand new. Yeah. And it took them, like, they had image models for years and it took them that long to come up with a separate, relatively basic interface for generating images. I would almost argue the application layer companies, like the CRIAs, the Hedras, the Higgsfields of the world, popularized that template format. I agree. And did it first and did it better. I agree. And they are ChatGPT's product people, and then maybe the ChatGPT product people are So it's a supply chain of product ideas.

16:30Exactly. Well, maybe going in a slightly different direction, BK, I'm very curious for your take on OpenAI's social features, because it does feel like that's something that you really have to get product execution right on, but also network design. You know, there's some efforts around Sora, too. We should talk about that. There's also group chats within ChatGPT. You're our sort of social guy, or have been historically bullish, bearish. Where's your head at? Bearish, for now. Okay. And the reason to me is twofold. Historically, we look at sort of, it's funny, I look at products based on what I call inception theory.

17:04You go like three to four layers down to figure out what the one-liner is, which is like, I want my dad to love me. And so, you know, when they think of a product. Is that for you or for the world? That's for me as well as for a lot of people. Okay, yes, yes. And so I look at some of the, you know, products like Chachi PT. Ultimately, when you peel the onion five times, I think essentially is help me be better. Like help me get that information, help me be more productive, help me be more efficient. And then when I think about social features, meta, Instagram, what have you, or even TikTok, the two layers of information or the, you know, emotion that it's trying to address to me is for TikTok, entertain me.

17:43I want my clown, entertain me. And then the other layer is I'm lonely. I want to be seen. I want to connect with people. And to me, these are pretty two different parallels in the product direction. And OpenAI's product is incredible. It's magic. It's amazing. But it's ultimately a see me or help me category, which essentially is why it's the number one in productivity category. Now we're trying to take this and shove it in people's life and say, guys, connect, connect better and like actually feel like you're being seen. and even the group chat function, which I love. It'll be so good to plan a trip and actually have that common pain.

18:24But I think it still stops at probably end count of two to three people planning something in a help me way versus, oh, I feel like I understand a niche so much better because I've sort of done that. So largely over time, I think that's the reason of that division. But that is not to say you can build a separate product that completely sort of addresses that. I think Sora, so we talked about group chat. Sora 2 was the other big, I think, social push this year from all the consumer AI giants. Which was basically like a TikTok feed, but all AI generated video and you can make cameos of your friends.

19:01The cameos was a very good bet. It was a strong bet. Yeah. But I think what we've seen is like in the retention data and how we're seeing it used is it was massively successful as a creator tool. Like now my feed is probably two thirds AI slop, if not more. And over 50 % of it is now Sora, whereas before it was like all VO and some cling. But it has not been as successful as like a social app. Consumption. Yeah, people are like a small number of creators are creating a ton of content and then bringing it out to like TikTok, Instagram, X, Reddit, where it's going massively viral. But it doesn't seem like there's as much consumption happening in the app.

19:43Yeah. As much remixing, as much commenting, especially as there was initially. You know, in a funny way, the way I think about it is like Sora's competition or analogy isn't actually TikTok. It's actually Capcom. It's like a funny way. It's almost like a creative tool. Yes. Yes. Olivia, what's your thing? Well, I was going to say like I think it goes back to your earlier point, which is like the kind of motion that drives social apps is both these like positive and negative feelings of like, oh I'm publishing this thing of myself that's kind of sensitive or that I want people to think it's this or that or this other thing and so that's kind of what drives participation on the app yeah the status game yeah a little bit of status exactly the status game and when it's AI generated content and people know it's not real like a real representation of you as a human being the status game is lost a little bit absolutely yeah I think the status game comes then with can you prompt something very cool?

20:40Yeah. But that's a different type of product. And that's why I think it goes viral on like Twitter and all these other existing platforms. I mean, my sort of counterpoint or bull case for Sora 2 is actually think the status game was about humor more than anything else. And humor is the intersection of knowing how to prompt and sort of being culturally aware. Yeah. So I think that if they iterated on that, that's like a direction that nobody has captured before. Yeah. Yes, but if you can export those videos, Yes. Isn't it true that like TikTok with Sora videos on it is strictly better than Sora?

21:11We talked about it so much where like the ultimate social product is where consumption and creation both live together. And that the output of it is not native to other platforms like TikTok, like YouTube Shorts. So what do folks think of the challengers? You know, we're talking about Sora 2. I mean, Meta, it's crazy to talk about Meta as a challenger. I guess in this context they are, but I think Claude, Perplexity, Grok are the more obvious names for challengers. Olivia, what's your take? I love Claude. I talk to Claude all the time. Claude has somewhat replaced ChachiBT for me as my general LLM.

21:46I think Claude is opinionated in an interesting way. I also love Claude because I'm willing to invest time into building out AI workflows. I think Claude actually launched a lot of really powerful things this year around like artifacts and skills where you can essentially set up tasks or workflows to run over time. I do think the reason it hasn't hit the mainstream yet is even the way they built those things is geared towards a technical user or an engineer. It's I think they tried to make skills as easy as they could to create. And it still was not anywhere near easy enough for the mainstream consumer.

22:22Another example would be they were actually the first of the big players to kind of launch file creation, slide deck creation, editing. And they branded it as like file generation and analysis or something. And it was like a toggle feature within a setting bar of a setting bar or something. So like very few people used it. And yet to me, it's still the best product across all of them at doing that kind of complex work. So I love Claude, but I think if they want to be a true mainstream consumer product, they need to dumb it down even more in terms of accessibility. There was that survey you found recently of U.S.

23:02teens. Yeah, there's I think it was three times more U.S. teens have ever used character AI than have used Claude. Yeah. So I think that shows that like Claude is a pretty broad thing. Cloud is beloved amongst tech people, but outside of tech people, I think they are maybe struggling to pick up relevance. It is interesting, though. Like, if you look at the sort of aesthetics, the product design, the craft, like three things that Anthropic did were MCP, skills, and command line interface, Cloud Code. Yeah. Like, those are three surprising bets, especially Cloud Code. I would have said, command line interface, really?

23:37Like, is this the way that people want to interact with? I thought you were going to talk about taking over airmail and the thinking cap. Yeah, that too. They're a consumer. So through your thinking, where's the thinking cap? Yeah. But it's sort of very high-minded design. Yeah. It's sort of like versus mass market or maybe that's apologetic on their behalf. But I think it is that. It's opinionated and it's great. Yeah, yeah. I do need to hear Justine's take on both Meta and Grok as I feel like they both had fascinating years in different ways. So Meta hired all those researchers. I think their strongest models are actually not consumer facing models.

24:13It's their SAM 3 series. So like the segment anything for video, for image and for audio. And basically like for video, for example, you can upload a video and you can describe a natural language like find the kid in the red t-shirt and it will find and track that person across every, the entire video, even if they're coming in and out of the frame, it will let you apply effects like blurring them out or removing them or whatever. And you can imagine a similar thing with audio with different stems and then with image with different objects in an image. I think we're going to see next year, hopefully, some incredible consumer products built on top of those models.

24:52But today, they're more of a playground for developers than they are a consumer-based product. Given just like the DNA of the company. Yeah. So the one good consumer feature I think they've launched this year with AI is the Instagram AI translations, where when you're uploading a reel now, you can opt in to enable translations and it will clone your voice, translate it into five different languages, apply the translation with your voice. So, you know, and then re-dub with the lip sync. Wow. And so it basically makes it seem like you're a native speaker in whatever language. So I would love to see more of that stuff come to the Meta products.