Why AI is central to the new browser wars – Crypto News – Crypto News
Connect with us

Metaverse

Why AI is central to the new browser wars – Crypto News

Published

6 months ago

on

Despite launching Chrome only in 2008, Google turned it into the world’s most popular browser, with a 65% share. Chrome played a key role in Google retaining its monopoly in search, where its share is nearly 90%. Now, in an ongoing trial, the US government may force the tech giant to sell its browser as a remedy for its monopoly in search.

Some see similarities between this and a landmark case in 1998, when the US government alleged that Microsoft abused its monopoly in operating systems by bundling its Internet Explorer browser with Windows, making it difficult for rival browsers like Netscape to compete. While there are parallels, this time it is different because artificial intelligence (AI) is reshaping the entire digital landscape, including how users search for information online.

The ongoing remedies phase follows an August 2024 ruling that the company illegally maintained a monopoly in online search and used a flywheel effect to establish dominance. A key focus was on Google’s deals with smartphone manufacturers. This included, for example, a payment of $26 billion in 2021, including $18 billion to Apple. With a large user base, it could collect more data, which improved the product, attracting even more users.

The US government has proposed behavioural and structural remedies, the most significant of which was to force Google to sell its Chrome browser. It has also proposed that Google should end its exclusive default search agreements with device manufacturers like Apple and that it should license its search results to competitors.

The AI effect

The current case is also important in the context of AI, which has impacted both browsers and search. Now, many users get information online through conversations with chatbots, rather than through search engines. As a result, Google is facing the heat on multiple fronts: from search-focused AI companies such as Perplexity (which has about 15 million active users) to AI model creators such as OpenAI and Grok (with integrated search features in their chatbots). They are all well-funded.

Then, there are traditional rivals such as Microsoft, integrating AI into its browser, Edge. New AI players are getting into browsers, too. Perplexity plans to launch Comet, integrating autonomous AI agents for tasks like research and decision-making. OpenAI reportedly also plans to launch its browser. Both Perplexity and OpenAI (besides Yahoo!) have expressed interest in buying Chrome, as it would give them control over a key ‘access point’ and also valuable data.

Intelligent devices

New AI companies are also equally worried about the deals Google has made with smartphone makers to consolidate its position in search because it is extending to AI, too. Google reached a deal with Samsung to pre-install the Gemini AI app on its devices, and hopes to reach an agreement with Apple to make Gemini available through Apple Intelligence on iPhones.

Last month, Perplexity AI’s chief business officer, Dmitry Shevelenko, testified that Motorola was unable to change the default assistant from Google due to existing obligations, “despite both parties wanting it to be”. Similarly, OpenAI indicated that Google’s ability to outspend startups kept device makers like Samsung from making pre-installation deals. Apple and Samsung had a 39% share in smartphone shipments in Q4 of 2024, according to Counterpoint Research. They have little incentive to switch to other services since they get billions of dollars from Google.

Marketing muscle

Outspending competitors in such deals has long been part of the traditional playbook for big companies to maintain dominance. However, with disruptive technologies such as AI, product innovation plays a bigger role. That’s how OpenAI could garner a billion users in less than three years. Yet, startups tend to struggle to break the well-entrenched connections forged by incumbents beyond a point. It’s especially true with Google, which has also been innovating on AI. The gap between its marketing spend and research & development expenses has widened in the past three years.

Still, an adverse ruling could open the gates for newer players. Besides the ongoing trial, Google is also preparing to face another remedies trial, scheduled to begin this September, in the online advertising market. AI will play an increasingly important role here, too. In both cases, Google has vowed to appeal if there is an adverse ruling.

www.howindialives.com is a database and search engine for public data.

Related Topics:
Continue Reading

Trending