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As Google continues its legal battle in the search antitrust case, the giant is moving forward with expanding new search features powered by generative AI.
Last week, Google debuted an experimental “AI Mode” for search to let users ask follow-up questions. The feature, powered by the company’s new Gemini 2.0 model, will provide answers, real-time information, multimodal answers, and links within AI Overviews. The feature also uses Google’s ranking system from its knowledge graph with real-time data about places and products.
Google’s updates came just days before the company and the U.S. Dept. of Justice on March 7 filed final remedy proposals before a scheduled hearing in court next month. The DOJ’s proposal includes forcing Google to divest its Chrome browser, increasing transparency for its search ads business and introducing rules for data transparency and search partner interoperability. Google’s proposal includes barring exclusive pre-install deals for search, chrome and its Gemini assistant.
For now, AI Mode is still a limited invite-only test for Google One AI Premium subscribers. However, it could give hints about how Google plans to compete more directly against Perplexity and ChatGPT with generative search. However, the competition for AI search has already been worrisome for publishers. According to a new report from Tollbit, clickthrough rates for AI chatbots like ChatGPT are 96% lower in Q4 compared with traditional Google search.
Elsewhere, other competitors are seeing some growth. For example, a February report from the privacy-focused browser Brave said organic search volume grew 80% in December to 1.19 billion from 656 million in January. Meanwhile, it said that the click volume for Brave Search Ads grew by 15x.
Perplexity could also soon appear in other real estate. Last week, Deutsche Telekom — the parent company of T-Mobile — said it’s building a new smartphone with a new “Magenta AI” assistant powered by Perplexity and other new AI partners like Google Cloud AI, ElevenLabs, and Picsart.
One big question when the phone debuts is how soon it will become new real estate for mobile AI search ads via Perplexity and others. Major mobile phone companies like Apple and Samsung have long engaged in advertising and search deals. It’s also the subject of the ongoing search antitrust case with Google, which also had some Friday updates.
Yet another new tool is also available to help marketers navigate AI search’s frontier. Last week, Yext launched Yext Scout, an AI-driven search and competitive intelligence tool that provides real-time insights into how a brand appears in traditional search engines and chat-based searches like ChatGPT and Gemini.
Yext Scout, powered in part by Yext’s recent acquisition of Places Scout, offers brands competitive benchmarking to see their standing against rivals. It also provides recommendations for improving their results based on what people are likely asking in queries across various platforms.
Microsoft also announced news related to AI, search and ads. One update it debuted is a new pilot program for brand-created agents. Instead of traditional web navigation, Microsoft aims to have consumers chat with branded AI assistants for entertainment, shopping and travel.
“Imagine if a website could talk,” Kya Sainsbury-Carter, Microsoft’s head of advertising, wrote in a blog post. She also mentioned early pilots are starting this month with clients on an invite-only basis.
“People wouldn’t need to scroll and click through links; they could simply ask what they want to know and have customized information delivered to them,” Sainsbury-Carter wrote. “For brands, this can boost engagement and conversion rates as a helpful agent guides their customers through the last mile of the shopping experience.”
WPP and Stability AI
In non-search AI news last week, WPP announced a new partnership with Stability AI, which includes a joint R&D pipeline, access to Stability’s AI models, and a direct integration with WPP’s AI platform, WPP Open.
The move marks a rare instance of an agency holding companies investing in startups that don’t have a direct connection to advertising (i.e., ad tech, martech, or agencies). It’s also likely to raise new questions about how it could shape content production across WPP’s agencies. Also, how much money will they save, and/or how will it affect the speed, quantity, or quality of creative outputs?
Something that wasn’t mentioned in WPP’s announcement: Stability is currently a defendant in an AI copyright lawsuit filed by Getty Images. The complaint, filed last year, alleges Stability stole 12 million images for AI training. The 2023 lawsuit also asked for up to $150,000 in damages for each infringed work. Will WPP clients be nervous about creating ads if the legalities are unclear, and will anyone be nervous about what might happen to their own creative IP?
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