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EYE on AI

ChatGPT failed to kill Google Search

With Google’s multibillion user moat and deep pockets, it’s thriving despite OpenAI’s first-mover advantage.

6/8/26 9:43AM

A year ago it wasn’t clear how AI was going to work out for Alphabet, which missed out on the first-mover advantage held by OpenAI’s ChatGPT.

The fear was that AI competition would eat into traffic for Google’s all-important Search business. And that incorporating AI answers into its own searches could cannibalize revenue, since customers would be less likely to pay for their blue-linked pride of place if people got all their answers up top. Those fears have not materialized.

AI is “driving an expansionary moment in search,” Google CEO Sundar Pichai said in his remarks at Alphabet’s investor presentation Friday.

“When people use AI-powered features, they use Search more — in fact, queries reached an all-time high last quarter,” he said. “AI Overviews and AI Mode are driving user engagement and AI-powered ad tools are driving better ROI for advertisers.” It helps when your distribution scale is practically unmatched: Google said its Search AI Mode has already crossed 1 billion monthly active users, while AI Overviews now have over 2.5 billion.

Outside traffic numbers from Similarweb seem to agree, showing a recent uptick in global visits across Google after falling slightly when ChatGPT first came out:

Bank of America recently said it thought Alphabet’s new AI ad formats noted at its I/O conference “should help capitalize on growing AI search format usage and could accelerate Search monetization.” Of course, Google’s win is the rest of the web’s loss. AI Overviews are tanking publisher click-through rates, and though Google just introduced an opt-out tool under regulatory pressure, few publishers can afford to disappear from a search engine with 90% market share.

With Google incorporating AI into all parts of Search, the success of its stand-alone chatbot Gemini is becoming less important, as evidenced by the overall growth in Google traffic. Many have previously remarked that Gemini lagged the popularity of ChatGPT, but even that is doing pretty well, recently growing market share and gaining on leader ChatGPT, according to data from Apptopia:

In all, Google’s main cash cow, Search, has seen revenue growth accelerate last quarter, growing 19% year on year.

And Alphabet is making sure it has the capital to keep it that way. Last week, the company announced a massive $80 billion equity capital raise to fund its massive computing infrastructure push. Alphabet expects to spend an eye-watering $180 billion to $190 billion on capital expenditure this year alone, a financial war chest that startups like OpenAI simply cannot replicate.

OpenAI may have had the first-mover advantage, but Alphabet is proving that the ultimate advantage is still having billions of built-in users — and the endless billions of dollars required to keep them there.

Chris Stokel-Walker

Bot bias

6/17/26

Companies are getting AI chatbots to smear their competitors

The race to influence AI chatbots is leading to some companies to adopt shady competitive tactics.

Tom Jones6/17/26

Prediction markets have, predictably, been given a boost by the summer of sports

Major platforms like Kalshi and Polymarket have seen huge upticks in users of late, thanks in no small part to what’s felt like a recent sporting smorgasbord, with major competitions across hockey, basketball, and soccer soaking up fans’ time (and spending, clearly) at the outset of summer.

While gaming industry groups may not like it, there’s been a huge change in the methods people are using to put money on the big games, with everyone from fortunate NYC bar owners, to a far less fortunate Spanish supporter, turning to prediction markets to try and turn their sports know-how into cold, hard cash.

According to a new report from Adam Blacker for apptopia, that shift might have been even more seismic than imagined in the wake of the NBA and NHL finals and around the 2026 World Cup kicking off.

2026 World Cup Reverses Seasonal Lull for Sports Betting Apps

According to a new report from Adam Blacker for apptopia, that shift might have been even more seismic than imagined in the wake of the NBA and NHL finals and around the 2026 World Cup kicking off.

South by Southwest Conference and Festivals

Gold Tesla Cybercabs are piling up, but they’re not picking up passengers yet

Low-volume production started in April. Now people are noticing them more and more in the wild.

Rani Molla6/15/26

Millie Giles

TAKING ACCOUNTS

6/15/26

Britain announces social media ban for under-16s starting early 2027

The UK government plans to use the same model for the restrictions as Australia — but how successful has that case study been so far?

UK Prime Minister Announces Under-16s Social Media Ban

Jon Keegan6/15/26

Anthropic pulls Fable and Mythos access worldwide after Trump administration bars their use by foreign nationals

Only days after releasing two versions of its next-gen AI model, Anthropic has disabled them for users worldwide.

Anthropic says it received a Friday night order from the Trump administration to suspend access to the models for any foreign national (anywhere in the world) — a group that included some Anthropic employees. In response, the company turned off access to everyone.

Last week, the company released to the public its much-anticipated Claude Fable 5 model (and its restricted version Claude Mythos 5, which is still being tested with trusted partners). Anthropic said in a blog post announcing the action that officials cited national security concerns with the new models, while offering few specific details.

The post said that the government gave the company “verbal evidence of a potential narrow, non-universal jailbreak” of the public Fable 5 model. A jailbreak is a means by which users can evade restrictions built into the code to unlock prohibited functionality. Anthropic downplayed the significance of the attack, and said other major models, such as OpenAI’s GPT-5.5, could also be affected by the technique described.

Fears of these first Mythos-class models being misused are running high, after Anthropic warned the cybersecurity world in May that the advanced cyber capabilities of Mythos have rapidly discovered thousands of vulnerabilities in ubiquitous software, leading to the decision to restrict the full version of the model to a close group of trusted partners for testing.

This morning, Axios reported that Anthropic technical staff have flown to Washington to meet with White House officials to resolve the issue.

The Wall Street Journal is reporting that the Trump administration’s decision to take action against Anthropic was prompted by discussions that Amazon CEO Andy Jassy had with officials, including Treasury Secretary Scott Bessent. According to the report, Amazon researchers said they had been able to evade some of Fable 5’s security restrictions using specific prompts. Amazon is a major investor in Anthropic.

Anthropic is currently suing the US government to fight the Pentagon’s blacklisting of the company on national security grounds.

Statement on the US government directive to suspend access to Fable 5 and Mythos 5