Executive Overview
Over the past year, the generative artificial intelligence sector has transitioned from a phase of raw technological wonder to an era defined by a search for sustainable monetization. Amid this shift, search-focused AI startup Perplexity embarked on one of the industry’s most aggressive and closely watched growth experiments. By partnering with Bharti Airtel, India’s second-largest telecommunications operator, Perplexity offered its premium "Pro" subscription—normally retailing for approximately $200 per year—entirely free to Airtel’s vast user base of 360 million subscribers.
This high-stakes giveaway served a dual purpose: it was designed to quickly build scale in the world’s most populous digital market, while also serving as a strategic move against dominant players like OpenAI and Google. However, the true test of any "freemium" or subsidized distribution model lies in what happens when the promotional window closes.
As the earliest one-year subscriptions expired in mid-2026, the first wave of empirical data emerged. The results present a nuanced picture of the economics of consumer AI. While the end of the promotion triggered a sharp 90% decline in new app installations, Perplexity’s monthly active users (MAUs) and net revenues remained resilient.
This case study offers an early look at whether bundling high-cost AI services with telecom utilities can foster long-term user habits and yield sustainable subscription revenue in price-sensitive emerging markets.
Detailed Chronology of the Airtel Partnership
July 2025 Oct 2025 Jan 16, 2026 July 2026
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Partnership Launches MAUs Peak at Redemption Window First Cohort of Promo
(5.9M July Downloads) 22 Million Closes Subscriptions ExpireThe Launch (July 2025)
The partnership between Perplexity and Bharti Airtel was officially announced in July 2025. Under the terms of the agreement, Airtel subscribers could redeem a complimentary 12-month subscription to Perplexity Pro. This premium tier offers users access to advanced large language models (including GPT-4 and Claude Pro), file upload capabilities, and unrestricted search queries.
The immediate market response was significant. According to data from mobile intelligence firm Sensor Tower, Perplexity recorded 5.9 million app downloads in India in July 2025 alone—a 625% increase from the previous month. This single-month total surpassed the 5.4 million cumulative downloads the app had generated across India during the entire first half of 2025.
The Growth Phase (August 2025 – January 2026)
This momentum was not a short-lived launch spike. Throughout the seven months the promotion remained open to new redemptions, Perplexity became a highly downloaded utility in the Indian app ecosystem.
Between July 2025 and January 2026, the platform accumulated an estimated 56 million downloads in India—more than nine times the volume recorded during the preceding seven-month period. Monthly active users surged from an average of 2.6 million in the first half of 2025 to 8.9 million in July, eventually peaking at 22 million in October 2025.
The Redemption Sunset and Expiration Wave (January 2026 – August 2026)
The window to claim the free 12-month subscription closed on January 16, 2026. Because users retained access for a full year from their individual activation dates, the promotional lifecycle extended well into 2026.
By July 2026, the earliest cohort of users reached the end of their free promotional period. At this point, the mechanism shifted: users were transitioned to a paid subscription model unless they actively opted out of the auto-renewal process. This transition period provides a clear look at user retention and monetization dynamics.
Supporting Context & Metrics: The Post-Promo Reality
The end of the promotional acquisition funnel in January 2026 led to a significant shift in Perplexity’s performance metrics, highlighting the difference between subsidized growth and organic market demand.
PERPLEXITY INDIA METRICS: PRE vs. POST PROMO
Metric Pre-Promo (H1 2025) Promo Peak (Oct 2025) Post-Promo (July 2026)
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Monthly Downloads ~900,000 ~8,000,000 ~550,000
Monthly Active Users 2.6 Million 22 Million 14 Million
Monthly Net Revenue $34,000 (Jan '25) $70,000 (Dec '25) $156,000 (July '26)The Download Cliff
Once the free Airtel offer ended, Perplexity’s acquisition rate dropped sharply. Sensor Tower estimates that between February and July 2026, Perplexity was downloaded 3.3 million times in India—a decline of more than 90% compared to the preceding six months. This drop suggests that without a subsidized incentive, organic interest in downloading the app returned to near-baseline levels.
User Retention and Engagement Resilience
While new user acquisition slowed, the existing user base showed notable stability. Monthly active users, which peaked at 22 million in October 2025, settled at approximately 14 million in July 2026.
Although this represents a 37% decline from the peak, the 14 million figure is still more than five times higher than the 2.6 million monthly active users Perplexity averaged in the first half of 2025. This indicates that a meaningful portion of the acquired users integrated the tool into their daily digital routines.
Revenue Trends and the Auto-Renewal Factor
The most critical metric for assessing the success of the experiment is the financial return. Despite the drop in downloads, Perplexity’s revenues in India trended upward:
- In-App Purchase Revenue: Sensor Tower estimates that Perplexity’s in-app purchase and subscription revenue in India between February and mid-August 2026 rose approximately 60% compared to the active promotional period.
- Daily Revenue Spikes: From July 18 through August 12, 2026—the period when the first major wave of Airtel subscriptions expired—average daily in-app purchase revenue was 9% higher than the preceding 30 days and 27% higher than the daily average for the first half of 2026.
- Long-Term Revenue Growth: Appfigures data reveals that Perplexity’s monthly net mobile revenue in India grew from $34,000 in January 2025 to $70,000 in December 2025, and reached $156,000 in July 2026. During the first seven months of 2026, the company generated an estimated $878,000 in India—a 16% increase over its total revenue for the entirety of 2025.
Perplexity Net Mobile Revenue in India (Select Months)
Jan 2025 | $34,000
Dec 2025 | $70,000
Jul 2026 | $156,000However, these figures carry an important caveat: because the promotional subscriptions were set to auto-renew, some portion of this revenue growth likely stems from "passive renewals"—users who simply did not cancel their subscriptions in time—rather than intentional conversions.
Additionally, the widespread marketing and visibility of the Airtel campaign likely attracted organic, paying customers who were never part of the free giveaway.
Comparative Performance: Perplexity vs. Competitors
To determine whether Perplexity’s growth was unique or simply part of a broader rise in AI adoption across India, Appfigures compared Perplexity’s download trajectories against competitors OpenAI (ChatGPT) and Anthropic (Claude).
Daily App Downloads in India (Launch Week of Airtel Promo)
Perplexity (Pre-Promo): 11,200/day
Perplexity (Post-Launch): 223,000/day (Peaked at 305,000/day)
ChatGPT: [Broadly Stable]
Claude: [Broadly Stable]The data indicates that the growth spike was unique to Perplexity. Prior to the Airtel launch, Perplexity averaged roughly 11,200 daily downloads in India. Within the first week of the promotion, that figure rose twentyfold to 223,000 daily downloads, eventually averaging 305,000 daily downloads between mid-September and mid-October 2025.
During this same window, download rates for ChatGPT and Claude in India remained stable, showing that Perplexity’s partnership successfully diverted user attention and captured market share that organic search demand alone would not have generated.
Industry Analysis and Expert Perspectives
Industry analysts point out that while the metrics show positive growth, they also highlight the unique challenges of the Indian market.
Abe Yousef, a senior insights analyst at Sensor Tower, noted the resilience of Perplexity’s user base:
"While the time-sensitive nature of this promotion would naturally lead to a decline in adoption after the offer period, ongoing usage has remained resilient. Perplexity has retained significantly more users in India than it did in the six months before the promotion."
Ariel Michaeli, co-founder and CEO of Appfigures, raised an important point regarding the financial metrics, suggesting that the branding value of the partnership may have been just as important as direct conversions:
"The enormous visibility generated by the promotion may also have attracted paying users who were never part of the giveaway."
This distinction is crucial for evaluating the return on investment of such promotions. If the primary driver of new revenue is external organic users drawn in by the marketing campaign, the direct conversion rate of the subsidized users may be lower than top-line revenue growth suggests.
Future Outlook: The Indian AI Market Challenge
The strategy pioneered by Perplexity has since been adopted by other major players, turning India into a key battleground for subsidized consumer AI distribution.
MAJOR AI SUBSIDY INITIATIVES IN INDIA
Company Partner Offer Detail Launch Date
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Perplexity Bharti Airtel 12 Months of Pro (Free) July 2025
OpenAI Direct (ChatGPT Go) 12 Months of Premium Tier (Free) August 2025
Google Reliance Jio 18 Months of AI Pro (Free) October 2025Following Perplexity’s July 2025 initiative, competitors quickly launched their own localized programs:
- OpenAI introduced its "ChatGPT Go" plan in August 2025, offering a year of free access to a customized, lower-cost tier designed for Indian consumers.
- Google partnered with Reliance Jio, India’s largest telecom operator, in October 2025 to offer an 18-month complimentary subscription to its Gemini Advanced/AI Pro service.
The Monetization Paradox
India is a highly attractive market for user acquisition, featuring over 700 million smartphone users, cheap mobile data, and high app download rates. However, translating this scale into meaningful subscription revenue has historically been difficult. Consumer software companies often find that users in price-sensitive regions are highly willing to adopt free tools but quick to churn when asked to pay.
For AI companies, this challenge is compounded by high operational costs. Unlike traditional software-as-a-service (SaaS) models, where the marginal cost of serving an additional user is near zero, generative AI services incur significant computing and infrastructure costs for every query processed. Running millions of free, advanced search queries for subsidized users represents a substantial ongoing expense.
Conclusion
Perplexity’s partnership with Airtel serves as an early test case for this model. The data shows that while a massive giveaway can successfully drive scale and establish user habits, the transition to direct monetization remains a steep hill to climb.
Over the coming months, as subsequent cohorts of Airtel subscribers reach their renewal dates, the long-term viability of this customer acquisition strategy will become clearer. The results will help determine whether subsidizing high-cost AI services through telecom partnerships is a repeatable blueprint for global expansion, or a costly lesson in the challenges of emerging-market monetization.
