On Sunday The New York Times reported that Google is furiously working to incorporate conversational AI into its core search products — not exactly news, but there was a larger takeaway: Google has got to get some killer AI products out the door, and fast, or it risks losing its core users for good. And if my own family is any indication, the company is already imperiled. More on that below, but first, a bit more on the Times piece.
The article led with big news: Samsung may decamp from Google and partner with Microsoft’s Bing instead. This would be a major blow both financially as well as optically — Samsung’s commitment to Android is a key reason Google’s mobile platform towers over Apple’s iOS in terms of worldwide market share.
But the real partnership to watch is Google’s deal with Apple itself. Estimated at $20 billion annually, this deal ensures that Google’s core search engine is the default on more than 1 billion iOS devices. If Google loses that deal to Microsoft, the entire tech world will be re-ordered. For now, Wall Street seems to think the deal isn’t in jeopardy (the stock price is a handy gauge), but even the speculation that Google might lose Apple leaves Apple with an extraordinary amount of leverage for the balance of this year (details are thin as to when the deal actually renews, but analysts think it’s late 2023).
The short of it is this: Google’s got to respond, and soon — or it risks losing its most important distribution deals, and by extension, its most profitable customers.
Then again, if my wife Michelle is representative of a larger swath of Internet users, Google’s got a fight on its hands today — not sometime in the future should Samsung or Apple decide to bolt. And it’s not Bing that’s winning — it’s ChatGPT. Yes, ChatGPT had “only” 1.6 billion visits in March, roughly 1% of Google’s totals. But that’s up from 1 billion in February, and with compounding growth like that, it won’t be long before Google’s facade of immutability starts to crack.
Given all this, the Times piece reads as obvious — of course Google is rushing to “incorporate AI into search” — but what will those products really look like? For answers, it makes sense to look at how…