In this week’s edition, we explore the resilience of Google, Meta’s appointment of a new AI leader, and other key developments. Don’t miss this week’s Decoder episode addressing the future of deepfakes.
Additionally, do you utilize AI coding tools like Cursor or GitHub Copilot? I’d appreciate hearing about your experiences with them.
“I think we are doing very well through this moment”
Insights gained from discussions with Google executives at the company’s I/O conference in May reveal a notable sense of confidence among the leadership. This week, their optimism becomes clearer.
Contrary to fears that ChatGPT could render Google Search obsolete, AI innovations seem to be bolstering Google’s position in the market.
During their latest earnings call, CEO Sundar Pichai shared that AI Overviews in search results have improved global query rates by over 10%, a trend that continues to grow. Essentially, mimicking features akin to ChatGPT has driven increased usage of Google’s search functionality, particularly among younger demographics that had previously shown diminishing engagement with traditional search results.
The introduction of the Gemini app has also seen significant uptake, with Pichai noting over a 50% increase in daily prompts compared to the previous quarter, resulting in a monthly user base growth from 350 million in March to over 450 million now. Last month, Google processed nearly a quadrillion AI tokens, more than doubling its figures from May.
Confidence is also reflected in Google’s approach to the ongoing competition for AI talent. Pichai noted that their retention rates and new hire metrics remain promising, despite some high-profile exits grabbing headlines. He emphasized, “I think we are doing very well through this moment.”
Amid Meta’s eagerness to recruit leading researchers from DeepMind, sources indicate that Pichai and Demis Hassabis have avoided engaging in bidding wars and seem willing to let their workforce maintain its stability. This stands in stark contrast to the atmosphere at OpenAI where research head Mark Chen has likened Meta’s recruitment tactics to a home invasion.
Industry speculation suggests that DeepMind maintains a sufficiently talented pool to withstand personnel departures and has the capability to enact what they refer to as reverse acquihires, as exemplified by their recent acquisition of Windsurf, a company that opted out of navigating the financially challenging landscape dominated by major tech firms.
In a recent interview, Hassabis remarked, “Meta right now is not at the frontier. Maybe they’ll manage to get back on there, and it’s probably rational what they’re doing from their perspective because they’re behind and they need to do something.” This statement underscores the belief that Google is currently in a strong position within the AI sector, a sentiment echoed by other major players in the field.
However, Google faces challenges as well. The anticipated release of GPT-5 could surpass Gemini’s capabilities. While ChatGPT remains dominant in the chatbot domain, trends are indicating that Google is directing fewer clicks toward websites, posing a potential threat to the business model that has sustained its growth. Furthermore, there is a tangible risk that the US government may pursue antitrust actions against Google, including the possibility of ending its payment agreement with Apple for default placement on iPhones.
Despite these hurdles, AI has proved to be less detrimental to Google’s business than many had initially anticipated. Increasingly, it seems that Google is emerging from this competition in a more robust position.
Overheard
“This is the enigma of success in an industry that has no franchise value.”
– Microsoft CEO Satya Nadella in a memo to staff reflecting on recent layoffs alongside the company’s rising stock performance.
“Unfortunately, I think ‘No bad person should ever benefit from our success’ is a pretty difficult principle to run a business on.”
– Anthropic CEO Dario Amodei in a leaked communication to employees concerning potential funding from the Middle East.
“If we can make intelligence accessible everywhere, affordable to everyone, and easy to understand, we can drive the biggest opportunity engine the world has ever seen and help more people live better lives.”
– Incoming OpenAI executive Fidji Simo subtly hinting at future advertising strategies for ChatGPT.
“I’ve created more billionaires on my management team than any CEO in the world. They’re doing just fine.”
– Nvidia CEO Jensen Huang on the All-In podcast.
“I was given an offer that would explode [the] same day.”
– Windsurf’s second hire, Prem Qu Nair, sharing on X about how Google recruited the startup’s engineering team.
Personnel log
Recent career transitions to note:
- Mark Zuckerberg has appointed Shengjia Zhao, co-creator of ChatGPT and GPT-4 at OpenAI, as the chief AI scientist for his new Superintelligence AI lab. Zhao will report to Alexandr Wang.
- At Microsoft, AI chief Mustafa Suleyman has recruited former Google DeepMind personnel, including Amar Subramanya, VP of engineering for Gemini. Jacob Andreou, previously with Snap, will lead product and growth initiatives.
- In a concerning sign, Darshan Kantak, Snap’s SVP of revenue products, is resigning just before earnings reports.
- Anthropic CPO Mike Krieger and Duolingo CEO Luis von Ahn are joining the board of Figma in anticipation of its IPO.
- Instacart CPO Daniel Danker has been appointed as Walmart’s head of global AI acceleration, under CEO Doug McMillon.
- Tom Conrad has been named the permanent CEO of Sonos, with a call to enhance the app’s performance.
Link list
Here are some links worth exploring:
- Sam Altman joins Theo Von on his podcast.
- Edwin Chen, CEO of Surge AI, appearing on the No Priors podcast.
- OpenAI’s analysis on ChatGPT usage trends.
- “‘Show me the money:’ Founders, loyalty, and the new rules of the AI gold rush.”
- Insights from the decline of trust and safety in tech.
- Meta previews the impressive technology behind its upcoming mind-reading wristband, set to debut with display glasses.
- Exploration of how Substack authors are leveraging AI.
- A review of the culinary offerings at Tesla’s inaugural diner in Los Angeles.
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