My point is that this is not how a healthy company can think about its most strategic activities. This sort of failure is not something you can hedge against.
It's like Apple hedging against the risk of failing to keep iPhone competitive by investing in some other device maker that might be able to compete with Samsung.
By failure I don’t mean they can’t make an LLM product, I mean the LLM product doesn’t have majority market share to be used as an ad surface (or other monetization strategy). That’s only partly dependent on their research and modeling efforts. The revenues they could make from an LLM api business are too small to register for them right now, the market share and product work is also important.
If Google fails to compete in AI, they will lose search and some competitor will siphon off all their advertisig revenue.
This is all coinciding with regulators taking a closer look at all the other ways in which Google protects its search monopoly. You know, the ones that are not so much based on merit.
Google is at risk of losing both its technology leadership and its grip on distribution channels at the same time.
You should first ask yourself why Amazon became a minority shareholder in a company already invested in by Google.
So this bet doesn't have anything to do with AI, it is a competition between AWS and Google cloud. They are competing over who gets to sell shovels in a gold rush.
But Google is at the same time propping up a competitor while Amazon is propping up a purely complementary service.
It doesn't know how to keep new information flowing into the AI.
If AI replaces the need to visit the original website and everyone just stays on google.com then a great deal of the web will just stop being updated because nobody is reading it and nobody will read it.
That's googles problem. Frankly it's a problem for every company who wants to try and supplant google search with AI.
When first LLMs and ChatGPT came about, I thought it was just another hype but the web, and the web search industry hangs in a balance (Google in particular).
P.S.
>If AI replaces the need to visit the original website and everyone just stays on google.com then a great deal of the web will just stop being updated because nobody is reading it and nobody will read it.
But even today and for a very long time as a matter of fact, you can use RSS for website updates and read them in your RSS reader and yet classic web still didn't fade away.
Of course Google would prefer Anthropic to beat (or at least be competitive with) OpenAI, but only if they can't do it themselves.
Has Google management lost confidence in its own AI capability? Or are there so many leading AI researchers that refuse to work for Google?
To me this looks like Google is in big trouble.