Opera : Leading the Browser Renaissance
OpenAI’s ChatGPT has taken the world by storm. Fortune 500 executives are trying to ascertain its impact on their business model and any disruption it may bring or opportunities it present. Hoi Polloi are talking about how it will enrich their lives — It is one of the favorite dinner table topic at my home. In my memory, no other technological advancement has created so much buzz since the introduction of smart phones.
As an Opera bull, I have been thinking about how this will affect Opera and its business model. Those interested can read my Opera Bull thesis here:
I think browser will be ripe interface for enabling new Generative AI created capabilities for the masses. Edge and Opera have already announced it and other will follow suit as well. All of sudden, we are in “Browser Renaissance” where we will see AI powered new capabilities added to browsers which, broadly speaking, has not evolved much in last decade or so.
But if every browser ends up implementing generative AI, what would be the differentiator. How can Opera compete if all browsers end up copying/offering what Opera is planning to do. After all, Opera is that proverbial underdog in David Vs Goliath for over a decade and has been written off many times since early 2000 and yet, it has not only managed to survive but has created a niche which is allowing it to thrive in some of these niche user segments.
Opera has some key advantages:
Opera caters to interest specific audience and thus able to provide more tailored and personalized experience. It has created 3 differentiated browser offerings - Opera, Opera GX and Opera Crypto browser. Opera has around 80M MAU of its flagship Opera browser, 20M MAU of Opera GX and ~1M users of its Crypto browser. Both Opera and Opera GX are seeing strong growth in western markets. Opera Crypto does not have critical mass yet and its adoption depends on how the overall web3/crypto space evolves. Opera has plans to create more interest specific browsers and most probably next one is going to be focused on sports as per fairlight capital. My personal wishlist is browser tailored for kids in pre teen to early teen segment helping them from digital distraction and giving parents more control and visibility over kids browsing history.
The flagship Opera browser has added differentiated features around Shopping and news content and could benefit from more tighter integration with AI based chatbots/services. The recently announced Shorten feature will be nifty feature and an incentive for new users to switch to Opera. Opera also has the advantage of providing both ChatGPT and Google Bard AI to its users, as opposed to Chrome which can only integrate with Bard and Edge which can only integrate with ChatGPT.
Opera already has AI expertise with its Opera News offering. Given Opera’s focus on Niche browser, its AI team can build generative AI based LLM models with lot fewer parameters thus reducing the cost of training and inferencing to be economically viable to offer as ad supported free service to its users.
Opera GX is growing nicely in US and other western markets. Generative AI can help with Game reviews and other gaming specific ChatGPT services. [Imagine Opera GX has a AI service to shitpost/memepost like Opera GX social media team ..just kidding :) ] . Opera can incorporate AI based coding chatbot to truly democratize game development on its Gamemaker platform.
For large players, browser is not “the business model” and hence may not get executive mindshare and visibility as opposed to Opera where browser is the only business model. Given Opera’s singular focus on browsers, Opera can execute lot faster and decisively than goliath’s and may have advantage in Time to Market for generative AI based unique features compared to large players and this may help it to win mindshare and accelerate its adoption in western markets.
In some way, Opera can replace the desktop skin by becoming the default desktop skin although this is very low probability event as OS vendors will try their best to steer its users to their native browser and would create roadblocks for it to not happen. Increasing regulations(specially in EU) and crackdown on monopolistic practices can work in Opera’s favor but it remains to be seen.
I do not think Opera will take over the world with generative AI based capabilities but I do believe it can continue to thrive by innovating around niche and differentiated features which other general purpose big browsers can not replicate and can easily double its market share from its current 2-3%. Generative AI will revolutionize many user experiences and browser will be one of the favorite interfaces as pointed out by Greg Brockman, president and cofounder of OpenAI.
After a lull of over decade, I think we are entering the period of “Browser Renaissance” and Opera being the only large pureplay browser provider, would be driving the innovation in this space and would benefit financially from it. Any market share gains from the generative AI craze/hype/adoption and new differentiated capabilities would be completely additive to the bull case I have laid out previously.
As an Opera browser user for over a decade now, I would be watching closely and can’t wait to get my hands on the shorten feature and other generative AI based capabilities Opera is planning to introduce in future. As Song Lin, Opera Co-CEO, said in one of the earnings calls, history of browsers is not yet written completely and Opera would be at the forefront to shape it and this latest AI related announcement from Opera is certainly the step in that direction.
Disclosures :
I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise hold a material investment in the issuer's securities.
This is NOT an investment advice/recommendations. I am not a financial advisor. Do your own Due Diligence if you decide to trade/invest into OPRA.