Specifically, Alphabet Inc., parent company to Google, is constantly pushing the envelope with new and creative advertising solutions. They’re accomplishing this through their AI Mode, a new chatbot-style interface for Google Search. This latest major move—plugging ads into AI-generated answers to search queries—is just an experiment so far. While you may not be familiar with AI Mode, last May the company shared its intention to add ads to it. The financial implications for Alphabet’s core business remain murky.
CEO Sundar Pichai expressed optimism about the partnership with Apple, noting that Google will serve as Apple’s “preferred cloud provider” to develop “the next generation of Apple foundation models based on Gemini technology.”
History of the partnership
This collaboration is emblematic of a close, decades-old relationship between the two tech behemoths that has often produced lucrative wins for both parties. For instance, Google’s agreement to pay Apple $20 billion to maintain its status as the default search engine on Apple devices underlines the significance of their partnership.
Of all these promising developments, Alphabet has not yet released public details on how this partnership might affect its core business practices. In fact, on Wednesday’s fourth-quarter earnings call, the company blatantly avoided a pointed question from an investor. The question was primarily about what the Google-Apple AI deal would mean. Stakeholders are rightfully asking where the transparency is. They have a deep desire to know what Alphabet’s long-term strategy is in the midst of an ever-evolving world of artificial intelligence.
In AI Mode ads implementation is through using newsfeed ads below or even as part of the chatbot answers. This is a new feature that’s still in beta testing. Be advised that even this integration of ads is still considered an “experiment.” This very tentative initial step indicates that Alphabet is being very deliberate in evaluating user interactions and reactions before rolling it out citywide.
Sarah Perez is a veteran reporter for TechCrunch, since August 2011. As a former attorney, she provides an important perspective to her reporting on the big tech stories. Before joining TechCrunch, she spent over three years at ReadWriteWeb and has worked in various sectors within the information technology industry, including banking, retail, and software. Her deep experience offers a unique perspective into the challenges and opportunities of technology, including how it will affect businesses and consumers, and consumers themselves.
You can reach Sarah by email at sarahp@techcrunch.com or via encrypted signals messages to sarahperez.01.
As Alphabet navigates its evolving relationship with Apple and explores new advertising avenues in AI Mode, it remains to be seen how these developments will shape its future strategies and impact its overall business framework.