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Google is in the process of making significant changes to its search business model by considering the introduction of paid “premium” features driven by generative artificial intelligence. This marks the first instance where Google might restrict access to certain core features behind a paywall.
The potential overhaul of its lucrative search engine indicates Google’s ongoing struggle with a technology that poses a challenge to its primary advertising revenue stream, even after the introduction of ChatGPT over a year and a half ago.
According to sources familiar with the matter, Google is exploring various options, including incorporating AI-driven search functionalities into its premium subscription services. These services currently provide access to the new Gemini AI assistant in Gmail and Docs.
While the technology is being developed by engineers, the company’s executives have yet to reach a final decision on the timing or the eventual launch of this service.
It is worth noting that Google’s regular search engine will remain freely accessible, with advertisements still being displayed alongside search results for both subscribers and non-subscribers.
The potential introduction of charges for enhanced search features would mark a significant shift for Google, which has historically offered free services supported solely by advertising revenue.
In the previous fiscal year, Google generated $175 billion in revenue from search-related ads, accounting for more than half of its total sales. This poses a strategic dilemma for the company in terms of embracing cutting-edge AI technologies while safeguarding its primary revenue driver.
Since the launch of OpenAI’s ChatGPT in November 2022, Google has been under pressure to respond to the competitive landscape shaped by this popular chatbot. ChatGPT’s ability to provide comprehensive and swift answers to queries has posed a threat to traditional search engines by potentially rendering lists of links and associated ads obsolete.
Google initiated trials of an experimental AI-powered search service in May last year, offering more detailed responses to queries while still presenting users with additional information and advertisements. However, the integration of features from its “Search Generative Experience” experiment into its primary search engine has been gradual.
These advanced search results, featuring an “AI-powered snapshot,” incur higher costs for Google due to the increased computing resources required by generative AI. Access to the Search Generative Experience has been limited to a select group of users, including some subscribers to the Google One bundle.
In contrast, Microsoft, in collaboration with OpenAI, introduced enhanced GPT-powered search capabilities and a chatbot named Copilot in its Bing search engine over a year ago. Despite these advancements, Bing’s market share continues to lag significantly behind Google.
There are concerns among analysts that Google’s advertising business could be impacted if AI-generated answers eliminate the need for users to click through to advertisers’ websites. Additionally, online publishers reliant on Google for web traffic fear a decline in site visits if Google’s AI-powered search extracts and presents information directly to users.
Google recently introduced a premium tier to its Google One consumer subscription service, catering to users interested in utilizing the advanced Gemini chatbot. Gemini has also been integrated into Workspace, Google’s suite of online productivity tools such as Gmail and Docs.
The specifics of how Google plans to incorporate AI-powered search into its paid services, which offer various pricing tiers, and the timeline for the launch of this offering remain unclear. Nevertheless, Google may choose to gradually introduce elements of its experimental AI-powered service into its primary free search engine in the future.
Google has clarified that it is not currently exploring an ad-free search experience but is focused on enhancing its subscription offerings with new premium capabilities and services.
In a statement, Google emphasized its commitment to evolving Search to align with users’ preferences for accessing information naturally. The company highlighted the positive growth in search queries across its major markets as a result of its generative AI experiments and reiterated its dedication to enhancing the product to meet evolving user needs.
While no specific announcements have been made at this time, Google continues to innovate and refine its search offerings to provide an enhanced user experience.
