On May 10, Google announced that it has brought in a few changes in Search. Apart from new writing tools in Gmail and immersive directions in Google Maps, the tech giant also unveiled Search Generative Experience (SGE) on an “experimental” basis.

SGE uses generative AI to make responses to Google Search queries smarter, quicker and shorter. It can read everything available on the open web and uses that information to generate answers to questions in a conversational tone, rather than sharing just links as it has been doing for two decades now.

Google describes the feature as: “With new generative AI capabilities in Search, we’re now taking more of the work out of searching, so you’ll be able to understand a topic faster, uncover new viewpoints and insights, and get things done more easily... You’ll see an AI-powered snapshot of key information to consider, with links to dig deeper.”

This means news consumers (even shoppers, travellers or online consumers) don’t need to spend time clicking multiple links thrown up by Google Search to get the requisite information. It will be made available to users in one go.

Although Google insists that Search results will also share the links to dig deeper along with the ready-made answer, publishers fear that most users would never click those links.

This is what has alarmed online publishers, bloggers and website owners across the globe. Their revenue is largely dependent on advertisements on the websites. A significant portion of their ad revenue comes from Google ads.

As of now, people who specifically sign up for SGE can use the feature. But the move indicates a monumental shift for the company soon, which has been sharing links to other websites for the past 20 years for all ‘searches’.

“The AI-powered search engine will massively impact the traffic that comes to our sites, thus causing a dent to our advertising revenue,” several digital news publishers told e4m, requesting anonymity.

While news websites do get direct traffic from dedicated readers, most of it comes via Google Search. Google earned Rs 25,000 crore of ad revenue in India in FY22, a portion of which is shared with digital publishers.

The online editor of a news platform said, “The news links take users to our websites where they not only consume that particular news but also check other related and interesting stuff. They also click on advertisements of various brands. All this may vanish soon.”

Indian online news publishers’ revenue has been on a decline for the last few months due to a range of reasons, namely the drop in news consumption, a decline in sales of mobile phones, flattening of internet growth and ChatGPT. Google’s AI experiments will now be another blow for the digital news industry, industry leaders say.

It is to be noted that digital news publishers in India lost 20-40 per cent of their mobile traffic between October 2022 to February 2023, much before ChatGPT became mainstream.

Hence, this has come as a double blow for many media houses, especially newspapers, which have lost a big share of ad revenue during the pandemic and are still struggling to bounce back to the pre-Covid levels.

Google’s original business model at stake?

Using AI to generate answers to search questions has been a hot topic since the end of 2022 when OpenAI released ChatGPT. Microsoft quickly incorporated ChatGPT into its own search engine, Bing.

Google’s move primarily aims to take on Microsoft. However, its original business model worth $280 billion a year is at stake now, with digital news publishers fearing that they will have to bear a significant loss to ad revenue.

“The changes in Search are at an early stage as of now but when rolled out widely, it could significantly decrease the traffic that Google sends to digital publishers’ sites, as more people will be able to get what they need right from the Google search page instead,” says Prasanna Iyer, a Digital expert and Founder at Rezilient Digital. Iyer has worked with Google in the past and is currently working with several publishers.

The entry of AI-powered Bing built tremendous pressure on Google to enter the AI space and keep pace with its arch-rival. Hence, the tech firm was expected to roll out something similar to prevent Chrome users to switch to Bing, even if it comes at the cost of its original business model, a senior member of the Digital News Publishers Association (DNPA) said.

How does SGE work?

The Washington Post’s Geoffrey Fowler tested the feature and describes how SGE works:

“When Google’s SGE answers a question, it includes corroboration: prominent links to several of its sources along the left side. Tap on an icon in the upper right corner, and the view expands to offer source sites sentence by sentence in the AI’s response.

There are two ways to view this: It could save me a click and having to slog through a site filled with extraneous information. But it could also mean I never go to that other site to discover something new or an important bit of context.”

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Google’s response

Asked about publishers' concerns, Google India office shared a few press releases with e4m that were shared in the US conference last Wednesday detailing the latest AI features of the company.

One statement reads, “Since we rolled out Bard — initially in the U.S. and the U.K. — we’ve gotten quite a bit of feedback and have adapted quickly to make your experience with it even better. We recently moved Bard to PaLM 2, a far more capable large language model, which has enabled many of our recent improvements — including advanced math and reasoning skills and coding capabilities. In the past few weeks, coding has already become one of the most popular things people do with Bard.”

“But this early momentum is just the beginning. Today we’re introducing new ways for you to collaborate with Bard, and we’re sharing a bit more about our vision for what’s ahead. As we continue to make additional improvements and introduce new features, we want to get Bard into more people’s hands so they can try it out and share their feedback with us. So today we’re removing the waitlist and opening up Bard to over 180 countries and territories – with more coming soon.”

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