India’s AI boom has forced companies to trade short-term profits for their users.

The tech giant’s efforts to increase AI adoption in India may reach a turning point as the company ends free promotions in hopes of converting the world’s fourth-largest economy into paying subscribers.

India will become the world’s largest market for downloads of generated AI apps in 2025, expanding its lead over the United States with installations growing 207% year-on-year, according to market intelligence firm Sensor Tower.

Companies including OpenAI, Google, and Perplexity have launched expanded free premium offers to accelerate user growth in price-sensitive markets. Leading AI companies have also supported India’s efforts to become a global artificial intelligence hub. A major AI summit held in New Delhi last week was attended by leaders including OpenAI’s Sam Altman, Anthropic’s Dario Amodei, and Alphabet CEO Sundar Pichai. This is a sign that the country’s weight in the global AI race is growing.

Now some of that initial promotional push is winding down. Perplexity ended its bundled Pro offer with Indian telco Airtel in January, and OpenAI’s free ChatGPT Go access is no longer available in India. This sets the stage for a clearer test of how many of those potentially newly acquired users will convert to paying subscribers.

According to Sensor Tower data shared with TechCrunch, despite strong download growth, India still generates a disproportionately small share of AI app revenue, accounting for about 1% of in-app purchases, despite still driving about 20% of GenAI app downloads globally, highlighting monetization challenges in one of the industry’s fastest-growing markets.

Data shows that adoption of GenAI apps in India accelerated rapidly through 2025, with downloads peaking at year-over-year growth rates of approximately 320% and 260% in September and October, respectively. However, the surge in usage has not fully translated into increased revenue. In November and December 2025, AI app in-app purchase revenue in India decreased by 22% and 18%, respectively, compared to the previous month. ChatGPT’s revenue has declined even more sharply since it launched free ChatGPT Go access for less than $5 in November, down 33% and 32% over the same period. This reflects the short-term impact of our aggressive promotional drive.

ChatGPT still accounts for over 60% of GenAI in-app revenue in India. This means that changes in pricing strategy can have a significant impact on overall market performance.

Along with the promotional push, Sensor Tower explained that the surge in adoption of GenAI apps in India last year was a mix of new product launches, including the debut of platforms such as DeepSeek, Grok and Meta AI, and upgrades to leading chatbots such as ChatGPT, Gemini, Claude and Perplexity. Spreading word of mouth about AI-generated content has fueled adoption, with content creation and editing tools accounting for seven of the 20 most downloaded GenAI apps in India in 2025.

The user surge was equally notable. According to Sensor Tower, India will account for about 19% of the global user base of major AI-assisted apps in 2025, ahead of the United States’ 10%. While ChatGPT continues to dominate the Indian market in terms of monthly active users, competitors including Google’s Gemini and Perplexity have also seen rapid growth following promotional offers. According to previous Sensor Tower data, ChatGPT was the most downloaded GenAI app in India and globally in 2025. Earlier this month, OpenAI’s CEO said the chatbot now has more than 100 million weekly active users in India.

The promotional push in India reflects the AI ​​company’s broader strategy to reduce pricing friction in the value-sensitive market, betting that early user adoption and engagement will lead to stronger long-term retention once the free access period expires, said Sneha Pandey, insights analyst at Sensor Tower.

India’s appeal lies in its vast digital base. The country has more than 1 billion internet users and about 700 million smartphone owners, making it one of the largest potential markets for AI services globally and an important battleground for user growth.

Nonetheless, user engagement in India still lags behind mature markets. In 2025, users of leading AI chatbot apps in the US spent approximately 21% more time per week on the app than their counterparts in India, averaging 17% more sessions per sensor tower.

“AI in-app revenue will see meaningful but incremental improvements as users become more deeply integrated into these platforms and ongoing engagement becomes paramount,” Pandey told TechCrunch.

She added that pricing pressures in India are likely to remain elevated given the country’s young, value-conscious user base, so affordable tiers, telecom bundles and microtransaction models are important for long-term retention.

ChatGPT remains the clear market leader in India in 2026 with 180 million monthly active users based on sensor towers in January, followed by Google’s Gemini with 118 million, Perplexity with 19 million, and Meta AI with 12 million. These figures highlight the scale of the AI ​​opportunity in India and the growing challenge for businesses to translate rapid user adoption into sustainable revenue.

Google, OpenAI and Perplexity did not respond to requests for comment.