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Alphabet Stock Drops After Samsung Considers Switching Default Search to Bing

Samsung is considering ending its long-standing partnership with Google in favor of Bing as the default search engine for its devices. Alphabet, Google’s parent company, saw its stock drop by more than 3% in early trading Monday as a result of the news.

According to The New York Times, Google’s internal response to the possible change was “panic.” It is unclear whether Microsoft’s decision to incorporate ChatGPT into Bing was a driving factor in Samsung’s deliberation.

Since Google makes the bulk of its money from search ads, the development of AI search technology represents the greatest threat to Google’s search business in the past 25 years. As it stands, Google’s contract with Samsung generates around $3 billion in annual revenue. Google’s contract with Apple, which is up for renewal this year, brings in $20 billion in revenue.

Recent advances in AI have prompted Google to explore ways to incorporate AI into its flagship search product. According to internal reports, around 160 designers, engineers, and executives at Google are all working together in “sprint rooms” on a new project called Magi to build competitive AI-powered search features.

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Google is also working on a brand-new search engine that uses artificial intelligence more broadly. Plans for this new search engine are still in the early stages, and a release date has not been set. The future system will anticipate user searches, provide curated lists of potential purchases, and be more conversational, similar to Bing’s new search engine format. In the meantime, the goal of the Magi project is to enhance Google’s current search engine.

Jim Lecinski, a former Google vice president of sales and service and professor of marketing at Northwestern University, said the company has to now persuade users that it is as “powerful, competent and contemporary” as its competitors.

“If we are the leading search engine and this is a new attribute, a new feature, a new characteristic of search engines, we want to make sure that we’re in this race as well.”

During a test last week, Google employees quizzed the Magi project’s enhanced Google search on its conversational skills by asking it follow-up questions. Next month, Google plans to roll out the tools to the public, making them available to as many as 1 million users, with added functionality coming in the fall. According to The New York Times, the number will increase to 30 million users by the end of the year. The tools will only be available in the United States.

In a roadmap document, a Google executive revealed that the company is thinking about integrating artificial intelligence into Google Earth’s mapping features and providing a separate feature that lets users conduct music searches via conversation with a chatbot.

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A feature that uses AI to generate images within image results is also in the works, as is a feature that uses AI text conversations to teach users a new language. Users will also be able to ask a chatbot questions as they browse the web using a product called Searchalong.

Last year, Google made $162 billion from its search business. According to The New York Times, Google was taken aback by the prospect of Samsung, which sells hundreds of millions of smartphones with Google’s Android software every year, switching its default search engine.

In a statement to CNN, Google spokesperson Lara Levin said the company has always been committed to using AI to “improve the quality of our results” and “offer entirely new ways to search,” citing a feature rolled out last year that allowed users to search by combining images and words.

“We’ve done so in a responsible and helpful way that maintains the high bar we set for delivering quality information. Not every brainstorm deck or product idea leads to a launch, but as we’ve said before, we’re excited about bringing new AI-powered features to search and will share more details soon.”

Google has been involved in AI research for a long time, and its DeepMind lab in London is world-renowned. The company has also contributed to the development of autonomous vehicles and large language models used by chatbots. Due to concerns over the accuracy of AI, Google has been slow to integrate it into its search engine.

Google Search Page

Google Threatening To Shut Down Search Engine In Australia 

Google is currently claiming that it will shut down its search engine in Australia if a controversial bill that’s designed to benefit the news and media becomes law. This Friday, Australia’s Managing Director Mel Silva spoke at a Senate Hearing in Canberra in which they claimed that the “draft legislation remains unworkable and would be breaking the way millions of users searched for content online.” 

“If this version of the Code were to become law, it would give us no real choice but to stop making Google Search available in Australia. That would be a bad outcome not just for us, but for the Australian people, media diversity and small businesses who use Google Search. Right now Google’s main concern with the proposal is that it would require payments simply for links and snippets just to news results in Search. The free service we offer Australian users, and our business model, has been built on the ability to link freely between websites,” Silva told lawmakers

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Google and Facebook have long been fighting with publishers over how they display their content, while media companies believe that these tech giants should be paying them for the displays. Critics believe that based on how huge both Google and Facebook are, and since they dominate the online advertising business anyway, that they should realize that news publishers are left to scramble for advertising. 

If passed the new legislation would allow certain media outlets to “bargain either individually or collectively with Facebook and Google — and to enter arbitration if the parties can’t reach an agreement within three months,” according to the Australian Competition and Consumer Commission. 

Australian Prime Minister Scott Morrison recently called out Google for their threats and overconfidence in their ability to impact politics.

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“Let me be clear. Australia makes our rules for things you can do in Australia. It’s done by our government and that’s how things work here in Australia and people who want to work with that in Australia, you’re very welcome. But we don’t respond to threats.”

Google has yet to respond to Morrison’s claims, but if one thigns for sure, both Google and Facebook have been adamantly opposed to the code since its introduction in Australia last summer. In the same Senate hearing that Silva spoke at, Simon Milner, Facebook;s vice president of public policy for Asia Pacific, said that the company could “ultimately block news content in Australia if they wanted.”

Milner told lawmakers “there was already a deterrent effect of this law on investment in the Australian news industry. Sir Tim Berners-Lee in the UK said this precedent set by this law could ‘make the web unworkable around the world.’”

Regulators claim that this legislation is necessary because it would level the playing field for the news media in Australia, as a majority of newsrooms across the country have temporarily shut down, or reduced their service. The case is currently ongoing, and only time will tell what sort of negotiations emerge from both Google/Facebook, and Australia’s end.

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Google Travel Poses Major Threat to Online Travel Agencies

When you think of the top travel sites, you likely imagine companies like Expedia, Orbitz, and Kayak.com, which have long been used by travellers looking to book airline tickets, make hotel reservations, rent cars, and more. However, in recent months Google has entered the travel industry in a much more significant way with the launch of Google Travel, a service that leverages the company’s vast network of information to compete directly with Expedia and the like. Google, however, has a distinct advantage over other travel companies by virtue of the fact that it provides by far the most popular search engine in the world, accounting for 81.5% of all search engine traffic on the Internet. As people generally use search engines to find information to help them plan their travels, this fact gives Google a distinct advantage over rival companies, posing a potentially-existential threat to their businesses.

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Google Flights, is a service that allows people to search various airlines to facilitate the purchase of tickets through third-party suppliers, launched eight years ago in September 2011. This year, however, the company expanded their ambition in the travel industry by combining Google Flights with services allowing users to search for hotels and vacation packages with the May launch of Google Travels. What’s more, Google Travels also offers travel guides for locations around the world, presenting users with suggestions on things to do, recommended day plans, travel videos, and more. While rival services include similar functionality, Google Travel’s attractive, minimalist aesthetic is more likely to engage users, particularly those who are already entrenched in the Google ecosystem. As Google Travels integrates with other services like Google Maps and Android, it can offer customers a more streamlined, straightforward, and comprehensive approach to organizing information relating to travel.

Google’s efforts to rise to the top of the travel industry have directly resulted in shrinking traffic from Google to websites like Expedia and TripAdvisor, causing them to grow at a worryingly slow pace.

Crucially, however, Google also prioritizes search results relating to its own business over competitors. As such, when you search for the word “flight,” for example, the first result links to Google Flights, with competing services found lower on the list of results. As people most often click one of the top three links that appear in the results of a Google search, customers are naturally drawn to choosing Google’s services over their competitors, even in cases where competitors might offer a better option. Understandably, this has led to complaints from competing services, who blame the search giant for revenue slowdowns, as top travel companies struggle to figure out how to maintain dominance when faced with such a powerful competitor. Google’s entry into the business of travel coordination, and its practice of promoting its own services through its massive search engine, stings particularly because travel companies pay Google billions of dollars in advertising money to prioritize links to their websites in search results.

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Google’s efforts to rise to the top of the travel industry have directly resulted in shrinking traffic from Google to websites like Expedia and TripAdvisor, causing them to grow at a worryingly slow pace. According to Stephen McBride, writing for Forbes, Google earned around $18 billion from online travel agents that paid for advertising on their search engine last year, whereas the largest online travel agent, Booking.com, only earned $14.5 billion. To make matters worse, Google is charging these companies an increasing amount of money to appear near the top of search results as time goes on, further compounding their financial difficulties. However, as these companies’ advertising purchases are tremendously profitable for the search engine giant, Google is unlikely to deliberately drive them out of business, even though they could potentially do so with ease. As such, the company has developed a strange type of relationship with online travel agencies; though Google directly competes with them by offering the same services, their existence also helps them make money, meaning the massively powerful Google is incentivized to keep rival travel agencies in business while simultaneously cutting deeply into their profits. As a massively profitable technology company, Google is evidently finding it increasingly difficult to live up to their own standard of “don’t be evil,” which was once incorporated into its corporate code of conduct before being removed.