The Six Five team discusses Google I/O.
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Transcript:
Patrick Moorhead: So I was not able to go to the event, but I did watch the slideshow on YouTube. So it was pretty good, it was over three hours long. I didn’t watch the whole thing, but I watched the parts that I thought were super important. So I’m going to rattle off some of the announcements where there were holistically… This was all about generative AI and Google’s incorporation of it into their product.
So first and foremost, Bard is open to everyone. I made a comment that it was a very good sign that Microsoft opened Bing Chat to everybody and it signaled to me that the company was ahead of the curve. And I mean, that’s just a black and white. You open up to everybody, you’re making a huge commitment and it’s in all your data centers all around the world. You’re abiding by international laws for each country. So Bard is now open to everybody. It is not, however, integrated into search and I’ll get to that. PaLM 2, which is the new super awesome model. You can compare that to a GPT-4 type of thing. It’s Google’s version of it said it’s already powering Bard and getting better. I wish there was this is your brain on PaLM 2, this is your brain on PaLM 2, kind of like we see with GPT-4. OpenAI where you can pick 3.5 or 4.
Next big announcement was Workspace, which is the number two productivity and collaboration app across the globe to Microsoft 365. It brought out its own copilot. I know Microsoft is using that and a couple other people, but it’s called Duet AI and it’s doing exactly what you’d expect it to do, like create templates and spreadsheets and slides. I am totally jumping on that wait list because our backend is Google Workspace. I’d mentioned before, Dan, Google’s introducing automatic watermarking for AI generated content. So if you think you’re going to crank out a blog, rip off somebody’s content or make people think that… Not you, I’m talking to the audience here, but you’ve created this amazing piece of artwork and it was actually cranked out by something that was generated or maybe by Adobe Firefly, it’s going to let you know.
And I actually think that’s a good idea and quite frankly I think it’s going to put quality of content into classes, machine-generated and human-generated. And actually, I just think that’s a good thing. And by the way, sometimes the machine-generated content’s going to be better than the human-generated, but really thing to put your eye on. Vertex got an upgrade, that’s Google Cloud end-to-end data pipeline. I’m probably going to write up something on that. Google Search, new look but flirted the idea of integrating ChatGPT but not integrated. This is behind of what Microsoft is doing with Bing, that if you go to the Bing search and you do have a question, it will on the right-hand side, pull in Bing Chat information if it’s appropriate.
I mean, this is not a compliment. I know this, if you’re at Google and I say this, but it’s just the truth. I think the context was the Google was way behind in foundational models even though they had written literally the defining paper on it. And then Microsoft just absolutely comes in torrential speed, puts it into everything, opens it up to everybody beforehand. And just from a timing perspective, Microsoft is ahead. Google stock went down 5% and then there was another disclosure where the stock went down another 5%. So taking a beating here, but-
Daniel Newman: It’s up more than Microsoft year to date now.
Patrick Moorhead: Yeah, interesting. Here’s my net-net, Google made the case that it isn’t hugely behind on foundational models for consumers, B2B cloud or developer. I wish I could give you something more definitive, but they brought out 50 products and it takes a long time to digest it. Opening up Bard is a really good sign, putting it into search would’ve been a lot more impressive. I still don’t know how Google search integrates the foundational models and can afford it. It’s one thing when you have very small market share like Microsoft with Bing, and then you can make the case like they did, that says every incremental profit dollar is a good thing for the company that I get in advertising. When you’re the incumbent though and you have a certain profit model and your story is potentially lose share and increase costs, that’s not a good sign. Now, in the last earnings, we talked about CapEx is only going to be anomaly. I just don’t know the puts and takes. I don’t know where they’re going to take the money to invest the money, but I am standing by. Dan, what do you think buddy?
Daniel Newman: Well, thanks for taking all seven minutes, you left nothing. No, I’m kidding. So listen, first and foremost, Google is back in the eyes of the street. This event was big for the company after it kind of got some upgrades in rallies. The actual stock was up more for the year than Microsoft, at least at some point yesterday following Google I/O. So what does this mean? I think it means that message well received. Now, Google took immense criticism for its reactive response to GPT and Microsoft’s announcements with Bard and then it kind of fell on its face. So you’re absolutely right there. Having said that, this is really a classic buy versus build story. Microsoft bought the hottest, prettiest best looking and brought it to the prom. Google had been in a lab building, developing, investing and at least wasn’t totally ready and has been forced to continue to accelerate its build structure and come out with something new.
Opening Bard to everybody was a really good sign. But remember, when you open up Bard, it says experiment right next to it. And I was talking to a journalist about this yesterday and I said, “Really? The whole internet’s an experiment.” I said, if you think about it, everyone’s like, “Well, what if the information’s not correct?” Well, right now when you search, you then choose your own adventure and then you click on something and then you’re like, “I’m going to source this.” And you’re like, “How the heck do you know that that was right?” So I think the entire experience is just a sort of the evolution of the internet experiment. And I think for Google, you may as well roll it out, start training on it, building more utilization. Now I totally agree with you – having Bard exist in sort of a parallel versus having it immediately integrated into search – I think it does a couple of things.
One is using PaLM versus Bard for these different large language models for generating, it gives them the ability to do some AB testing. It also gives them the ability to train in parallel and then it gives the opportunity to stack models to create value. Because I’m betting you each model probably has its pros and cons. So now you’re seeing it actually building a multi-model experience, kind of delivering different user experiences inside of Bard versus Google Search, allowing people to stay within their familiar search, that is Google. And by the way, Google has so much search volume compared to Bing at this point. The expense would have to be as astronomical if they were going to immediately open up generative and use it at the same capacity that Bard is for every search inquiry they get. Remember, 90% of society probably has no idea generative AI is even a thing yet.
As much as we think it’s everywhere, Pat, that’s just because that’s what we do. Well, it’s our world. It’s the people we are around. And yes, our parents are aware of it, but I don’t know that they care yet that they get generative responses inside of Google. My folks have just become comfortable using traditional Google search at this point. It’s moving really quickly. I think in time, it’ll get picked up. Pat, I think the Duet stuff, is that what it’s called? Duet. That’s killer. Because we are also a workspace backend. Look, I write things. I would love to see them quickly be turned into slides. I love to – I am the worst PowerPoint creator on the planet. I mean, if you want to talk about making ugly slides, have me create your next slide. It is horrible.
But just anything that can be done to create an expedite productivity is really sweet. I think some nice upgrades to Android in terms of capabilities. And then also it’s kind of interesting, Pat, they quietly revamped or relaunched their home app. And this is kind of a weird thing because I’ve been wondering whether it’s been Apple Home, whether it’s been Google Home, whether Amazon, like everybody wants to build the smart home, but nobody’s really gotten that yet. Is Google the company that could do that? I don’t know. I have a fairly smart home here. Lighting systems and drapes and things like that that are on control and using a system called Savant. I mean, look, there’s not a great home control system, but with everything being connected to the internet, it really should be by now. So that’s a weird one.
But I thought it was kind of cool that they brought that back to the surface. But listen, make no mistake, this was an AI event about the AI search, about AI and apps, about AI in their phones and AI in their devices. And I guess, what I would walk away with is Google’s on the track, and you and I say this all the time, I’m going to say it again, we’re going to get onto the next thing because we’re going way too slow, is that AI and competition is good.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
