Small businesses are using more AI — but not paying

A survey of 1000 small businesses reveals that generative AI adoption is growing, with 36% already using it and 21% planning to in the next year. However, most current usage is limited to free or low-cost tiers. This means significant revenue growth from small businesses isn't imminent for AI companies. A majority (68%) of small businesses using generative AI spend less than $50 monthly on services. The survey defined small businesses as those with under $25 million in annual revenue and fewer than 100 employees. The "free sample" strategy, common since the 1990s, is being employed by AI companies. They anticipate converting free users to paid subscriptions over time. This strategy is crucial as AI companies like OpenAI seek new revenue streams. The current low spending by small businesses presents a challenge to AI companies' revenue projections.