CONSUMER AI'S ARPU PROBLEM

Summary from the TLDR AI newsletter

ChatGPT's viral "smile" retention curve obscured a monetization gap because it tracked gross rather than net retention, with even the most engaged consumers capped at $20/month while Anthropic's $44B B2B revenue grows on per-user spend expansion. Consumer AI fails to capture value the way coding agents and legal AI do because users don't view answers or fun images as worth paying for and resist coughing up subscription dollars for savings they already pocket.