Google is an ad company at the end of the day. Google is still making obscene amount of money with ads. Currently Gen AI is a massive expense in training and running and is only looking like it may harm future ad revenue (yet to be seen). Meanwhile OpenAI has not surpassed that critical threshold where they dominate the market with a moat and become a trillion dollar company. It is typically very hard for a company to change what they actually do, so much so that in the vast majority of cases its much more effective (money wise) to switch from developing products to becoming a rent seeking utility by means of lobbying and regulation.
Simply put, Google itself could not have succeeded with GenAI without an outside competitor as it would have become its own competition and the CEO would have been removed for such a blunder.
> It is typically very hard for a company to change what they actually do
Microsoft started out selling BASIC runtimes. Then they moved into operating systems. Then they moved into Cloud. Satya seems to be putting his money where his mouth is and working hard to transition the company to AI now.
Apple has likewise undergone multiplet transformations over the decades.
However Google has the unique problem that their main cash cow is absurdly lucrative and has been an ongoing source of extreme income for multiple decades now, where as other companies typically can't get away with a single product line keeping them on top of the world for 20+ years. (Windows being an exception, maybe Microsoft is an exception, but say what you will about MS, they pushed technology forward throughout the 90s and accomplished their goal of a PC in every house)
Also, though I dislike it greatly, Microsoft purchasing GitHub was a brilliant way to buy into a growing segment which were natively hostile to what they stand for. LinkedIn, maybe less clever, they only make pocket change on it, but it is profitable.
Google doesn't really do acquisitions on that level. They do buy companies, but with the purpose of incorporating their biological distinctiveness into the collective. This tends to highlight their many failures in capturing new markets. The last high-profile successful purchase by Google, that I recall at least, were YouTube and Android, nearly twenty years ago.
Waze was bought 10 years ago, and I think that one went well. They didn't try to integrate it to the whole Google Account thing, but they definitely share data between it and Maps (so Waze users get better maps, and Google Maps gets better live traffic information).
Remember that Microsoft spent 10 years fighting the open internet, and only launched the cloud much later. The Windows business was allergic to the web-model, and they fought it tooth and nail.
It's not about just ad revenue though, is it? Many thousands, if not millions of sites rely entirely on Google Search for their revenue. You cannot simply replace all of them with a chatbot - there are massive consequences to such decisions.
>It's not about just ad revenue though, is it? Many thousands, if not millions of sites rely entirely on Google Search for their revenue.
I mean these are kind of tangled together. Chatbots actively dilute real sites from what we are seeing, by feeding back into their fake into googles index in order to capture some of the ad revenue. This leads to the "Gee Google is really sucking" meme we see more and more often. The point is, Google had an absolute cash cow and the march towards GenAI AGI threatens to interrupt that model just as much as it promises to to make the AGI winner insanely rich.
Google is an ad company at the end of the day. Google is still making obscene amount of money with ads. Currently Gen AI is a massive expense in training and running and is only looking like it may harm future ad revenue (yet to be seen). Meanwhile OpenAI has not surpassed that critical threshold where they dominate the market with a moat and become a trillion dollar company. It is typically very hard for a company to change what they actually do, so much so that in the vast majority of cases its much more effective (money wise) to switch from developing products to becoming a rent seeking utility by means of lobbying and regulation.
Simply put, Google itself could not have succeeded with GenAI without an outside competitor as it would have become its own competition and the CEO would have been removed for such a blunder.