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The Ads Business Model Will Die & Lessons from Working with Elon at Twitter | Parag Agrawal

12 shifts in how agents search, pay, and monitor the web. The ad-supported internet was built for humans who click, not agents who read and never see the banner.

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With Parag Agrawal

"Ads don't work with agents in their current form." — Parag Agrawal
Parag Agrawal, on the episode

Parag Agrawal was CTO of Twitter and then its CEO before Elon Musk's takeover. He now runs Parallel, a company building web search infrastructure for AI agents, and the pop framing of him is still the Twitter chapter, the ousted CEO who worked under Musk. The actual operating system he's running now is sharper: agents will query the web a thousand times more than humans do, and every piece of infrastructure built for human search, including the ad model that funds the open web, breaks at that scale. He's not speculating about this, he's pricing it, from how much compute to spend per search to how much to pay a content owner for the marginal value their page adds to an answer. This protocol pulls the concrete mechanics of that new system: how to price content without ads, how to allocate compute across search modes, and how to flip search from something agents pull on demand to something that pushes to them automatically.

In this episode

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Tactic 01

Parag Agrawal, 20VC

Build An Adsense For Agents

The play

Price content access by marginal contribution to answer quality, not by seat, paying out the dollar delta a source adds or removes.

Parag Agrawal says

Ads don't work with agents because agents don't see or click banners, so ad-supported pages earn nothing when agents read them. I replace ad revenue by paying content owners a variable amount tied to the marginal value their content adds to an agent's answer.

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Pay content sources based on the measurable quality delta they add to an agent's answer, not a flat license fee.

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Tactic 02

Match Your Search Mode To The Agent's Time And Cost Budget

Parag Agrawal says

I built distinct search modes because a voice agent and a background research agent have completely different…

Episode quotes and Try this

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Tactic 03

Flip Search From Pull To Push With Event-Triggered Monitoring

Tactic 04

Allocate Compute In A Funnel, Not A Flat Pass

Tactic 05

Size The Market As A Fixed Slice Of Inference Spend

Tactic 06

Stop At The API Layer, Not The App Layer

Tactic 07

Automate Niche-Criteria Alerts Across Public Registers

Tactic 08

Secure The RL Environment, Not Just The Model

Tactic 09

Tell The Search Engine Which Model Is Asking

Tactic 10

Race To The Bottom On Price

Tactic 11

Treat Routing As Insurance Against GPU Scarcity

Tactic 12

Design For A Thousand X, Not For Today

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