Snap Walks From $400M Perplexity Deal

Snap just nixed its $400 million AI search partnership with Perplexity, ending plans to bring Perplexity’s conversational search into Snapchat’s chat feature. While both companies save themselves headache—Snap keeps its platform clean, Perplexity holds onto the cash—the trade-off is real: Snap loses a major revenue stream and Perplexity loses instant access to nearly a billion users. Meanwhile, the AI search race is heating up. Statcounter’s April numbers show ChatGPT towering at 77% share, Gemini now pulling ahead of Perplexity at 9% to 7.7%. Distribution is everything, and without Snap, Perplexity will face tougher, more expensive battles for every new user.

But here’s the catch: platform deals are fragile. Snap’s walk-away follows Amazon blocking Comet’s shopping agents, reminding everyone that relying on someone else’s turf is risky business. So, Perplexity is doubling down on what it can control—launching a new Mac app for seamless, agent-powered workflows across local files, cloud, and native apps. It’s betting that owning the desktop, CarPlay, and Samsung TV endpoints can build stickier, higher-value relationships, even if growth is slower than a viral platform partnership.

Legal and trust issues still loom. The recent class action over ad targeting was dismissed, but scrutiny around privacy and data sharing isn’t going away. Health advice from chatbots is under a microscope too, pushing Perplexity to add premium, peer-reviewed sources. Based on reporting from Tech Policy Press, WSJ, and 9to5Mac.

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