US multinational technology and internet-related services company Google, like other such companies, is looking for ways to capitalise on generative AI, AFP
US multinational technology and internet-related services company Google, like other such companies, is looking for ways to capitalise on generative AI, AFP
US multinational technology and internet-related services company Google, like other such companies, is looking for ways to capitalise on generative AI, AFP
US multinational technology and internet-related services company Google, like other such companies, is looking for ways to capitalise on generative AI, AFP


Google’s 'search' monopoly under threat with Gen AI advent


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September 04, 2024

For more than two decades, Google has been the dominant force in online search, building a $175 billion business that has become one of the cornerstones of the internet. Today, Google controls about 90 per cent of the global search market, but this position of power is under threat.

The rise of generative AI and chatbots, including OpenAI’s SearchGPT prototype, are shaking up the market and putting immense pressure on Google to adapt – or risk being eclipsed.

For one, Microsoft has invested $13 billion in OpenAI, and Apple has partnered with the company to integrate ChatGPT into its Siri voice assistant. These moves directly challenge Google’s search monopoly and signal that the American technology giant must act decisively or become obsolete.

Google’s rise to dominance was built on simplicity. Its clean, minimalistic design and powerful algorithms made it easier and faster for users to find information compared to its competitors, such as Yahoo, in the early days of the internet. By efficiently indexing and ranking vast amounts of information, Google established itself as the go-to search engine.

Rise of Gen AI

However, as the web has become more complex and technologies like Gen AI have emerged, Google’s once-groundbreaking model is starting to show its age.

AI-driven tools can generate direct answers to user queries, bypassing the need to sift through multiple links and pages – a process that has been the hallmark of traditional search engines like Google.

This shift in user behaviour is creating an existential threat to Google’s old search model. What was once its greatest asset – simplicity in search – has now become a liability, as AI-driven platforms begin to reshape the way people access information.

Adding to the pressure, upstart competitors like Perplexity, a two-year-old start-up with a $1 billion valuation that’s backed by Amazon founder Jeff Bezos, are gaining traction. These AI tools offer a more streamlined user experience, providing direct answers rather than lists of links, which is likely to draw users away from Google’s traditional search service. Who wants to see those annoying ads cluttering individual web pages when you can get straight answers right away?

For Google, this represents a major threat to its core business model, which relies heavily on advertising revenue. Google search alone generated $48.5 billion of Alphabet's $84.7 billion in revenue in the second quarter of this year.

Perhaps even more concerning for Google are the licensing deals between OpenAI and major publishers, such as the Financial Times, Axel Springer and the Associated Press. These agreements could restrict the availability of content on Google’s search engine, further weakening its stranglehold.

The relationship between Google and content creators has always been fraught, with some publishers voicing frustration over how their content is handled by the company. If AI-driven platforms secure exclusive content deals, it could force users to look elsewhere for information, diminishing Google’s value.

Despite the clear threat, Google has been cautious in its response to the rise of Gen AI. While the company has begun incorporating AI features, such as the AI Overview summaries at the top of search results, some tech commentators believe that Google’s focus on protecting its search and advertising monopoly has led to a more conservative approach to AI development.

Google’s search business remains a cash cow, and the company seems to be wary of making any moves that could cannibalise its existing revenue streams.

A big question facing Google is whether it should follow OpenAI’s lead in securing more licensing deals with publishers. However, such a move could come at a high cost. In 2020, Google pledged to pay news providers $1 billion over three years, but the potential expenses tied to copyright breaches could be substantial, putting pressure on the company’s bottom line.

One potential advantage Google has is its hardware. The newly released Pixel 9 smartphones, which come equipped with Gemini – Google’s personal AI assistant – offer a glimpse into how the company could integrate AI across its devices.

By controlling the Android operating system, Google can deeply embed AI tools into its products, essentially setting an industry standard for Samsung, Xiaomi and other Android phone manufacturers in a way to integrate Gemini. Such integration requires the deep expertise in AI that only Google can muster.

Apple, meanwhile, has created its own AI model called Apple Intelligence, which is built to operate mainly on users’ devices. Unlike large language models like GPT-4, Apple Intelligence is more lightweight. This is a deliberate choice, as Apple prioritises user privacy over the convenience that more powerful cloud-based AI might offer. As a result, Apple does not plan to integrate OpenAI directly into its devices.

Google is taking a different approach. It’s expected to integrate its advanced AI model, Gemini, directly into its Pixel devices, bringing all of Gemini’s powerful features to users.

New 'search' era

However, for Google to fully capitalise on its AI capabilities, it must address deeper issues related to leadership and strategy. The company’s culture of autonomy and freedom has been one of its core strengths. But this same culture may now be hindering Google’s ability to execute a cohesive strategy.

If Google is to remain a global tech superpower, its chief executive, Sundar Pichai, will need to unify the company’s diverse teams – including those running its core search and information services, its computing platforms including Android, plus its AI teams – under a single vision.

The company has come under fire for its cultural and organisational problems, including internal competition and a fragmented structure, which have held back its efforts in AI.

Looking ahead, Google’s ability to stay ahead of the curve will define its future, particularly as voice search continues to evolve. People are looking for quicker and easier ways to get information, and voice search makes it simple by letting them ask questions without having to type.

As smart speakers, voice assistants, and AI-powered smartphones become more common, people will likely move away from typing searches and start using more natural, conversation-like interactions to find information.

To maintain its dominance, Google needs to ensure that its technology not only keeps pace with these changes but leads them. This will require a level of innovation that transcends incremental updates to its existing search model.

Instead, Google must rethink the entire search experience, integrating AI in ways that make information retrieval seamless, whether through voice, text or perhaps even augmented reality.

The battle for the future of search will not be won or lost overnight. Google’s scale and resources still provide it with a significant buffer against competition. But the rise of gen AI has ushered in a new era of search, and whether Google can adapt to these changes will determine its very survival in the years to come.

Howard Yu is LEGO® Professor of Management and Innovation at IMD Business School, and heads IMD’s Center for Future Readiness.

The specs

Engine: 6.2-litre V8

Transmission: ten-speed

Power: 420bhp

Torque: 624Nm

Price: Dh325,125

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The specs

Engine: 4.0-litre V8 twin-turbocharged and three electric motors

Power: Combined output 920hp

Torque: 730Nm at 4,000-7,000rpm

Transmission: 8-speed dual-clutch automatic

Fuel consumption: 11.2L/100km

On sale: Now, deliveries expected later in 2025

Price: expected to start at Dh1,432,000

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7pm: Shadwell Farm Stallions Handicap (PA) Dh70,000 1,600m​​​​​​​
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7.30pm: Maiden (TB) Dh80,000 1,600m​​​​​​​
Winner: Dubai Canal, Harry Bentley, Satish Seemar.

UAE currency: the story behind the money in your pockets
What the law says

Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.

“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.

“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”

If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.

The biog

Name: Gul Raziq

From: Charsadda, Pakistan

Family: Wife and six children

Favourite holes at Al Ghazal: 15 and 8

Golf Handicap: 6

Childhood sport: cricket 

The specs: 2018 Mercedes-AMG C63 S Cabriolet

Price, base: Dh429,090

Engine 4.0-litre twin-turbo V8

Transmission Seven-speed automatic

Power 510hp @ 5,500rpm

Torque 700Nm @ 1,750rpm

Fuel economy, combined 9.2L / 100km

Scoreline

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 Saudi Arabia Al Muwallad 63’

A cheaper choice

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Cost: A minimum investment of $130,000 for a family of up to four, plus $25,000 in fees.

Criteria: Applicants must have a minimum net worth of $250,000. The process take six to eight weeks, after which the investor must travel to Vanuatu or Hong Kong to take the oath of allegiance. Citizenship and passport are normally provided on the same day.

Benefits:  No tax, no restrictions on dual citizenship, no requirement to visit or reside to retain a passport. Visa-free access to 129 countries.

Auron Mein Kahan Dum Tha

Starring: Ajay Devgn, Tabu, Shantanu Maheshwari, Jimmy Shergill, Saiee Manjrekar

Director: Neeraj Pandey

Rating: 2.5/5

UAE currency: the story behind the money in your pockets
MATCH INFO

Uefa Champions League, last-16, second leg (first-leg scores in brackets):

PSG (2) v Manchester United (0)

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SPEC SHEET

Display: 6.8" edge quad-HD  dynamic Amoled 2X, Infinity-O, 3088 x 1440, 500ppi, HDR10 , 120Hz

Processor: 4nm Snapdragon 8 Gen 1/Exynos 2200, 8-core

Memory: 8/12GB RAM

Storage: 128/256/512GB/1TB

Platform: Android 12

Main camera: quad 12MP ultra-wide f/2.2, 108MP wide f/1.8, 10MP telephoto f/4.9, 10MP telephoto 2.4; Space Zoom up to 100x, auto HDR, expert RAW

Video: 8K@24fps, 4K@60fps, full-HD@60fps, HD@30fps, super slo-mo@960fps

Front camera: 40MP f/2.2

Battery: 5000mAh, fast wireless charging 2.0 Wireless PowerShare

Connectivity: 5G, Wi-Fi, Bluetooth 5.2, NFC

I/O: USB-C

SIM: single nano, or nano and SIM, nano and nano, eSIM/nano and nano

Colours: burgundy, green, phantom black, phantom white, graphite, sky blue, red

Price: Dh4,699 for 128GB, Dh5,099 for 256GB, Dh5,499 for 512GB; 1TB unavailable in the UAE

Lexus LX700h specs

Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor

Power: 464hp at 5,200rpm

Torque: 790Nm from 2,000-3,600rpm

Transmission: 10-speed auto

Fuel consumption: 11.7L/100km

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Price: From Dh590,000

Financial considerations before buying a property

Buyers should try to pay as much in cash as possible for a property, limiting the mortgage value to as little as they can afford. This means they not only pay less in interest but their monthly costs are also reduced. Ideally, the monthly mortgage payment should not exceed 20 per cent of the purchaser’s total household income, says Carol Glynn, founder of Conscious Finance Coaching.

“If it’s a rental property, plan for the property to have periods when it does not have a tenant. Ensure you have enough cash set aside to pay the mortgage and other costs during these periods, ideally at least six months,” she says. 

Also, shop around for the best mortgage interest rate. Understand the terms and conditions, especially what happens after any introductory periods, Ms Glynn adds.

Using a good mortgage broker is worth the investment to obtain the best rate available for a buyer’s needs and circumstances. A good mortgage broker will help the buyer understand the terms and conditions of the mortgage and make the purchasing process efficient and easier. 

BIGGEST CYBER SECURITY INCIDENTS IN RECENT TIMES

SolarWinds supply chain attack: Came to light in December 2020 but had taken root for several months, compromising major tech companies, governments and its entities

Microsoft Exchange server exploitation: March 2021; attackers used a vulnerability to steal emails

Kaseya attack: July 2021; ransomware hit perpetrated REvil, resulting in severe downtime for more than 1,000 companies

Log4j breach: December 2021; attackers exploited the Java-written code to inflitrate businesses and governments

Updated: November 13, 2024, 8:58 AM`