Google is Cooked
Are we witnessing the disruption of traditional Google Search as we know it?
Disclaimer: Google is used only for the search and advertising business in the context of this post.
Google has been the king of search engines for a long time. When we want to find something online, we say, "Google it." But things are changing. GPT Services are coming in hot and fast. These new GPT players might give the king a run for its money in a 3-5 year horizon.
For a long time, I’ve argued with friends and colleagues that YouTube and Google are irreplaceable products. My belief in YouTube is bigger than that of Google because YouTube is a user-generated content platform, and Google is not. At the heart of Google is a proprietary algorithm that does a great job of ranking the search results. If a company can do a better job than Google at ranking the web pages, then essentially, they possess the recipe to dethrone the behemoth. For YouTube, the user-uploaded content is the moat; any company today could build a similar service to YouTube, but they can’t get creators to upload their content to the new service.
Google could be disrupted with an innovative way to present information, whereas massive public participation is needed to disrupt YouTube. Awareness, adoption, and change in user behaviour are the common denominators for both products.
ChatGPT Moment
Since GPT services came, I have been amazed by how meagrely I’ve used Google. When I first realised it, I instantly naively concluded that “Google is cooked.” My user behaviour purely drove this. But I like to think of myself as a power user and early adopter of tech, so my jumping quickly to a conclusion was wishfully driven, overly optimistic, and overly ambitious.
Legacy Goliath Ways
Google is great at finding information. You type 3-4 words, and it spits out links to websites with relevant content matching your search keywords (why am I even mentioning it?). But this has been the way it is for more than two decades. Because users are perpetually dissatisfied, they need more, better, cheaper. There was this discussion in tech circles on what the next Google will look like.
The problem with Google was that users had to go back and forth between website results, do their mental analysis, and conclude that into a final answer. That journey required the user to remember the result and go back and forth. Depending on the query, it could take between 30 seconds and 10-15 minutes to conclude.
Enter David: Chatgpt moment
When Chatgpt came along, it felt like one was talking to a human on the other side who happened to know many things and have opinions and views on practically everything out there. This was a significant shift from how a user would get value out of it, where users would go through each link, analysing and attempting to find what they were looking for. With GPT services, users would ask questions more naturally, like how a person would talk to a subject matter expert. The service will analyse the situation and present the conclusions. The users won’t have to analyse, saving them precious time and effort.
For example, I used Notebooklm to generate a report; the service analysed 140+ online sources to conclude the report in 7 minutes. This report would have taken me 15-20 days to prepare, and still would not have been able to match the quality of the report that I got in under 10 minutes.
This time and effort optimisation is a massive gain for users. Customers have been generous with Chatgpt, which became the fastest product to hit 100M customers and is now clocking in $1B in revenue.
Early Signs of Disruption
We can already see signs that GPT tools are doing well. Many people use tools like Chatgpt instead of Google to get quick answers. For example, students use GPT to understand complex topics, teachers use Chatgpt to discover simpler ways to explain complex issues and write emails, and many people use Chatgpt as an assistant to get their initial work done and then refine it further. These tools are becoming popular because they save time and offer intelligence and human-like reasoning.
Another sign is that GPT tools are growing fast. Companies are making new GPT models monthly and adding more features by the week, like voice answers, research assistants, or image creation. One can send a voice note to Meta AI in WhatsApp, which responds with a reply. This is mindblasting, to say the least. The pace of innovation is outpacing the traditional Google Search by any measure.
Younger people with ever-shrinking attention spans prefer GPT tools. They like how easy and fast these tools are and don’t want to spend time clicking links, which could mean fewer people using Google over time.
Web traffic results also indicate a shift from Google to new GPT players. As these tools become more widely known, usage will rise.
Future
Google is well aware of this change, being the giant company it is. They are trying their best to keep up with the pace of innovation. I must admit, they have done reasonably well in playing the catching game. Google now has models that are comparable to those of its main competitors. However, it's still a catching-up game, which is Google's biggest concern.
In the last two decades, Google has operated as a monopoly, enjoying a lion's share of the search advertising pie. The monopoly is ripe for disruption, with GPT services being as good as or better than Google's AI offerings.
Imagine if all Google users realised that GPT search is better than Google search. They would have 6-7 great options instead of just one. This would lead to serious competition between the players, leading to competitive pricing wars. The advertising market share would be shared equally by the players. This would lead to Google losing a big chunk of its revenue. Today, advertising revenue is ~77% of Alphabet's revenue. This is the primary source of concern for bosses at Alphabet, and they know it well.
However, in reality, awareness and adoption of new products take time. That has nothing to do with how good the product and services are; at scale, there are limits to growth. GPT tools have undoubtedly raised the limits, but adopting GPT tools in our daily lives will still take time. Until then, Google is rattled, scared of losing its dominance to Davids making their way in, and in the end, it will get disrupted, because monopolies don’t sustain for long; this is how the world works.