Thu. 05/08 – Is AI Eating Into Google Search?

Welcome to the Tech Mean Right Home for Thursday, May 8th, 2025. I'm Brian McCullough. Today, OpenAI has hired Instacart's CEO to be kind of a CEO. Apple reveals the degree to which AI might be eating into Google search. Aren't people seeing a return on their AI investments? and my dream grid gadget is finally coming to the US. Here's what you missed today in the world of OpenAI has hired Instacart CEO Fiji Simo as CEO of Applications.

Still reporting to Sam Altman who says he will remain CEO overall and focus on research, compute, and safety. Quoting Fortune. Altman said that CIMO, who has been serving on the board of the nonprofit that controls OpenAI for the past year, will be in charge of its new applications division that combines two existing groups within OpenAI that build and market its products and support its commercial operations.

SEMO is expected to remain at Instacart for, quote, a few months, while its board finds a successor, according to Altman's message to OpenAI employees. a veteran executive at meta prior to becoming ceo of the delivery app simo oversaw instacart's initial public stock offering in 2023 and has led a major push to expand its advertising revenue The company stock has risen 52% since the IPO, surpassing the Nasdaq's 30% increase over the period.

It's unclear how OpenAI's investors will react to the move, which comes just days after OpenAI said it would abandon efforts to have its nonprofit board no longer control the for-profit arm of the company. While Simo is highly respected in the tech industry, her hiring may raise questions about Altman's focus. and perhaps even how long he will remain at the helm of the company.

Many OpenAI backers including Thrive Capital's Josh Kushner and SoftBank's Masayoshi Son have said that their decision to put billions of dollars into the fast-growing AI startup was driven as much by their admiration for Altman's vision and ambition. as it was by the company's technological prowess.

Tech publication The Information, which was the first to report on the news of CMO's hiring, cited unnamed sources who had spoken with Altman about his recent hiring decisions and claimed that Altman has told people he is not interested in continuing to run all of OpenAI for much longer.

In his message to employees announcing CMO's hiring, Altman noted that creating OpenAI's products and building out the massive amounts of data center infrastructure the company needs to support the creation and distribution of those products could be its own large company, in his words.

Altman said that with SEMO focusing on the applications division, he will be focused on supervising the company's research division. Its safety teams, which work to ensure the AI models of the company is creating, don't pose significant risk to society. and the work expanding the company's access to computer resources, end quote. And quoting TechCrunch, SEMO has years of experience in product management and monetization before joining Instacart in 2021.

she spent more than a decade at meta leading the launch of ads on the news feed heading monetization for the facebook app overseeing product development for facebook video and helping build its advertising business She exited Meta as head of the Facebook app after joining Instacart. She helped take the company public in 2023.

In a post on X, Simo said she would stay on as chair of the Instacart board. In a letter to Instacart employees, she said a current member of the company's management would replace her as CEO as soon as an announcement could be made. SEMA will also help OpenAI in scaling traditional company functions, Altman said, but he didn't provide further details.

According to a report from Bloomberg, Chief Operating Officer Brad Lightcap, Chief Financial Officer Sarah Fryer, and Chief Product Officer Kevin Weil will report to her. Joining OpenAI at this critical moment is an incredible privilege and responsibility. This organization has the potential of accelerating human potential at a pace never seen before, and I am deeply committed to shaping these applications toward the public good, she said in a statement, end quote.

Again, on the Instacart side of things, CMO reportedly told employees that she is staying for a couple more months and that the new CEO of Instacart will probably be an internal hire from the current management team.

The US v Google trial is the gift that just keeps on giving in terms of headlines for us. Apple's Eddie Q said in court that Apple is quote actively looking at revamping Safari for AI search and that in April searches on iOS fell for the first time ever. Google's stock dropped 7.5% on this news. Quoting Bloomberg, Eddie Q. Apple's senior vice president of services made the disclosure Wednesday during his testimony in the U.S. Justice Department's lawsuit against Alphabet.

The heart of the dispute is the two companies' estimated $20 billion a year deal that makes Google the default offering for queries in Apple's browser. Q noted that searches on Safari dipped for the first time last month, which he attributed to people using AI.

Q said he believes that AI search providers including OpenAI, Perplexity, and Anthropic will eventually replace standard search engines like Alphabet's Google. He said he believes Apple will bring those options to Safari in the future. We will add them to the list. They probably won't be the default, he said, indicating that they still need to improve. Q specifically said the company has had some discussions with perplexity

Prior to AI, my feeling around this was none of the others were valid choices, Q said. I think today there is much greater potential because there are new entrants attacking the problem in a different way, end quote. Technology is changing fast enough that people may not even use the same devices in a few years, Q said. You may not need an iPhone 10 years from now, as crazy as it sounds, he said. The only way you truly have true competition is when you have technology shifts.

Technology shifts create these opportunities. AI is a new technology shift and it's creating new opportunities for new entrants." Q said that in order to improve the AI players would need to enhance their search indexes but even if that doesn't happen quickly they have other features that are quote so much better that people will switch. There's enough money now, enough large players, that I don't see how it doesn't happen, he said, referring to a switch from standard search to AI, end quote.

Now, Google disputed all of this, saying it is continuing to see, quote, overall query growth in a search, including, quote, an increase in total queries coming from Apple's devices and platforms. But as Mark Gurman points out, Q's disclosure of Apple's plan to shift its browser to AI systems had a clear goal, downplaying the importance of Apple's existing Google search deal.

If the industry has changed and there are now clear alternatives to Google, the judge may decide there's no reason to upend the long-running agreement. Q spent time praising these rival options, including perplexity service in particular. It is logical that Apple might highlight data points supporting the narrative that Google is not anti-competitive in search, Jeffries LLC analyst Brent Thrill said in a note.

but Apple and Google have the opportunity to deepen their partnership around artificial intelligence, something Q didn't focus on. Google has already pivoted its own Gemini AI system for search. When users make a query via Google, they are often presented with an AI result. That's true even on iPhones, iPads, and Macs today."

Speaking of, Anthropic has added web search to its API starting at $10 per thousand searches. giving Claude 3.7 Sonnet, 3.5 Sonnet, and 3.5 Haiku access to up-to-date information. Quoting TechCrunch, the rollout of the API comes as AI companies look to augment their models in various ways that might attract new customers to their platform.

For its part, Anthropic last week debuted a tool to connect applications to Claude as well as an expanded deep research capability that lets Claude search enterprise accounts, websites, and more. Developers can now augment Claude's comprehensive knowledge with current real-world data by enabling the web search tool when making requests to our API, Anthropic wrote in its release.

With web search, developers can now build AI solutions that tap into current information without needing to manage their own web search infrastructure. When the Web Search API is enabled, Claude will use reasoning capabilities to determine whether a given request would benefit from up-to-date information or specialized knowledge. If Claude decides to search the web it'll generate a search query, retrieve results, analyze them, and provide an answer with citations.

Claude can also refine its queries and conduct multiple searches using earlier results to inform subsequent queries. Developers can customize this behavior as well as specify domains from which Claude is allowed and not allowed to search. Devs can also allow or prohibit web search use at the organization level, Anthropic says.

In related news, Anthropic is bringing Websearch to Claude Code, its tool that allows devs to tap Claude to complete various coding tasks. With Websearch enabled, Claude code can access current API documentation, technical articles, and other information on development tools and libraries, end quote.

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now since I've been sharing recent data points suggesting AI is continuing to go gangbusters it's only fair that I share some data that suggests maybe the opposite An IBM survey of 2,000 CEOs found that only 25% of AI initiatives have delivered expected returns on investment over the last few years, and only 16% have scaled AI enterprise-wide.

quoting the register the study's findings published amid big blue's annual think conference on tuesday show that despite the hype around generative ai enterprises are struggling to get real value from the token spewing tech Just over half, 52% of CEO respondents say their organization is realizing value from Gen AI investments beyond cost reduction.

Despite this, enterprises aren't ready to give up their dream of using AI to automate their workers out the door. The study shows CEOs expect the growth rate of AI investments to more than double over the next two years, with 61% saying They're already adopting AI agents and preparing to scale them across their organizations. Rather than the chatbots, image generators, or search engines many of us associate with the tech, AI agents seek to automate entire tasks

by stitching together multiple tools, models, and data sources with or without a human being in the loop. As it stands, enterprise AI deployments appear quite narrow. The survey found that just 16% of the initiatives have scaled across the entire enterprise. Where enterprises are investing in AI, IBM says 65% of chief executives surveyed are prioritizing use cases based on their potential return on investment.

Much of this adoption IBM finds is being driven by FOMO. Nobody wants to get left behind on the off chance this whole AI thing actually lives up to the hype. And this appears to have driven nearly two-thirds or 64% of respondents to adopt technology before they've figured out whether it'll actually benefit the organization.

Given the pace at which generative AI is evolving, IBM says half, exactly 50% of respondents have found themselves juggling a growing number of disconnected and or piecemeal technologies. The sheer cost of AI hardware, whether it's in the cloud or on-prem, also remains a persistent challenge.

More than half of the participants in IBM's survey admit their organization struggles to balance funding for existing operations and investment in innovation when unexpected change occurs. That tension may help explain why AI investment for many still hasn't delivered the hoped-for return.

While the majority of those surveyed, 72%, believe that harnessing their proprietary data sets will be key to unlocking the true value of generative AI, IBM suggests that many organizations are still struggling to do so. As we've previously discussed, data often needs to be normalized and filtered before it can be integrated into AI workflows like retrieval augmented generation or used to fine-tune models, end quote.

More Netflix news. Netflix has unveiled its chat GPT powered search that lets users express preferences using natural phrases rolling out this week to iOS users as an opt-in beta. Quoting TechCrunch, this new search experience will utilize OpenAI's ChatGPT to provide users with a conversational discovery experience. Users can enter their preferences using natural phrases like, I want something funny and upbeat.

or even more detailed requests such as I want something scary but not too scary and maybe a little bit funny but not haha funny Other streaming competitors are also leveraging generative AI for search. For instance, Amazon has an AI voice search experience on Fire TVs. that responds to open-ended inquiries about TV shows and movies. A closer comparison is Tubi's ChatGPT powered search tool which answered content related questions and suggested movies based on a user specific request.

However, Tubi later discontinued the feature, probably because of low adoption. It remains to be seen whether Netflix's new feature will face similar challenges."

Finally today, an interesting gadget. Some of you know my predilection for batteries and solar as a backup slash replacement for powering my house. For years, I've looked jealously at Europe, which has had gadgets that let you plug solar directly into your power sockets so they can take some of the load off your grid, a plug-and-play solution quite literally. Well, This has finally come to the States with a bit of a catch.

quoting thomas ricker in the verge the us is finally getting a version of echo flows diy balcony solar system that i reviewed in europe last year echo flow says its stream series will be the first plug-in solar product to go on sale domestically allowing anyone in a house or apartment rental to easily lower their energy bill while also providing a modicum of backup power if the grid goes down.

Unfortunately, they're only going on sale in Utah, which recently approved balcony solar systems that plug directly into 120-volt wall outlets. No messy and costly interconnection agreement required with your utility company. ECHOFLOW tells me that there's no need to wait for a federal certification standard under the National Electrical Code or a tailored product safety standard from underwriters laboratories as some have interpreted.

balcony solar systems have already seen widespread adoption throughout europe where millions have been safely installed The plug and play stream series relies upon a microinverter to make solar energy grid ready for insertion back into the home. Some of that energy can also be diverted to EcoFlow's batteries for use in an emergency or for delayed release back into the home to help offset the higher prices utility companies charge when electricity demand peaks each day.

EchoFlow's Stream Ultra combines a built-in grid-tiered microinverter with a reasonably large 1.92 kWh capacity LFP battery. It can be installed inside or outside since it's self-heated to remain operational in temperatures as low as negative 20 degrees Celsius, which is negative 4 degrees Fahrenheit, with IP65 rated resistance to dust and rain.

storage can be expanded to 11.52 kilowatt hours by adding on additional battery only ultra units you can also buy the stream micro inverter separately if you already own a compatible echo flow power station the system can be configured with up to 2,000 watts of solar input from panels placed on a roof or the ground or slung over a balcony and when the microinverter is plugged into a dedicated

15 amp circuit the system can pump up to 1200 watts back into the home to offset the amount of electricity needed from your grid provider EchoFlow's stream devices are compatible with the company's new Oasis energy management platform that lets you remotely monitor and optimize everything according to your needs inside the excellent EchoFlow app.

Pricing is being announced with pre-order discounts that end on July 31st. The Stream Micro Inverter will initially cost $299 before hitting its $599 list price. The Stream Ultra and Micro Inverter is priced at $1,459, $2,399 list price, and the battery-only version of the Stream Ultra costs $1,199 versus an $1,899 list price, end quote.

Arsenal's Champions League adventure ended yesterday. But hey, as always, in sports, next year,