Google changed the world forever. It has been the guardian of information and knowledge for over two decades. Across hundreds of millions of websites, that tiny search engine bar took on the heavy lifting of giving you the information with the best odds of answering your questions—all in the shape of blue links.
When I first discovered Google, it was magic. Suddenly, I had the entire world’s knowledge at my fingertips. Type a query, get an answer.
Later, YouTube (also part of Google) opened up an even wider world of education. I could learn anything from history and philosophy to science and investing, all from some of the best minds in the world.
Don’t understand the logic behind differentiation and integration in math class?
Need to plan a self-guided trip to Japan?
Or perhaps learn how to cook scrambled eggs like Gordon Ramsay?
It doesn’t matter. Google had me covered.
With the rise of AI, I’m even more excited about how the world will look. The potential for personalized learning and instant access to synthesized knowledge is incredible. But this excitement needs to be tempered with a dose of realism.
Every couple of weeks, another new AI model is announced. Every other day (or perhaps every few minutes), someone on X declares, “I don’t use Google search anymore; I just use [insert latest AI tool].”
When I hear these proclamations about Google’s demise, my mind immediately goes to the investment graveyard. It’s filled with tombstones of failed theses built entirely on popular anecdotes.
Take Meta, for instance. In 2022, the consensus was clear: “Nobody uses Facebook anymore.” The stock cratered as Wall Street declared the social media giant obsolete. Today? Meta has surged over 700% from those lows and active users continue to rise.
Or consider Apple. Back in 2016, pundits solemnly declared “Apple will follow Nokia and BlackBerry into irrelevance” as smartphone growth slowed. Instead, the ecosystem strengthened and its market cap grew six-fold from $600 billion to $3.6 trillion.
Then there’s my personal favorite: “Netflix is doomed by competition and content costs.” Today, Netflix boasts over 300 million subscribers and has an operating margin of 27% while its competitors are struggling to turn a profit.
These narratives sound compelling because they’re simple and often relatable to a group of consumers. But markets aren’t driven by anecdotes—not in the long run. Eventually, financial performance, user growth, and competitive positioning win out over even the most entertaining narratives.
The truth is, people who complain often make the loudest noise, or sometimes it’s the people who like to signal that they’re cool for not using mainstream products or services. The majority of satisfied and contented users? They stay quiet and simply continue using the existing products.
As investors, we need to train ourselves to look beyond the convenient narratives and dig into the actual data. Facts over opinions. Numbers over narratives. Evidence over emotions.
Invert, Always Invert
Now, the future of Search is going to change—but how?
Looking into the future is inherently tough. So let’s invert the question—what would it take for AI-powered Search engines like ChatGPT and Perplexity to succeed?
Right now, ChatGPT, Perplexity, and other AI-powered search alternatives are playing the game on easy mode.
These companies are burning through capital with no clear path to profitability. They don’t show advertisements. Their cost per search is too exorbitant to deploy the best model at scale. And they take much longer than traditional search to load responses.
Right now, they just need to impress users and suckers investors to attract more funding as the AI fever continues.
But we all know this isn’t sustainable. Eventually, they’ll need to figure out monetization—and that’s where things get complicated.
I think we sometimes take for granted how extraordinary Google (and Meta) are at delivering free services at massive scale through advertising. When you look at other platforms with huge user bases like Pinterest, Snapchat, or even X (Twitter), they’ve struggled for years to crack the monetization code effectively.
There’s absolutely no guarantee these AI search companies will figure it out either. And what happens when they do need to monetize? What content will they show you? Will they prioritize the best answer, or the answer that makes them money?
Then there’s also the hallucination problem. Even today, I wouldn’t dare trust ChatGPT’s response about what time a restaurant opens any more than I would trust its recommended itinerary for Barcelona. You’d be in for a wild ride if you took these responses at face value without verifying through Google Search or Google Maps.
A quick ask: I’m heading to Barcelona, please send me any recommendations for your favorite attractions or restaurants.
The Four Pillars of Search Supremacy
For a search engine to truly dominate long-term, it needs four fundamental pillars working in harmony:
1. Accuracy – Results must be reliable and trustworthy. This is the foundation of user trust. While LLMs are improving, they still struggle with factual accuracy and hallucinations. At this stage, people might forgive Perplexity for occasionally making things up, but they hold Google to a much higher standard.
2. Speed – Results must be delivered almost instantaneously. Google’s research shows that a delay of even 400ms leads to a measurable drop in search volume. This is why Google’s infrastructure—built specifically for search speed (and costs)—matters so much. The consumer expectation for search is immediate gratification; anything less feels broken in comparison.
3. Cost-effectiveness – The infrastructure cost per search must be sustainable at massive scale. Google’s years of building custom TPUs (Tensor Processing Units) specifically designed for inference gives them a massive cost advantage over competitors relying on general-purpose hardware. When you’re processing billions of queries daily, even small efficiency improvements translate to enormous savings.
4. Default Status – The search engine must be the default option on most platforms to achieve mass adoption. Google is currently the default across most Apple devices, Android, and Browsers (i.e. Chrome)—the three dominant gateways to the internet.
Google excels at all four pillars. While competitors might match or even exceed Google in one area, none have demonstrated the ability to compete across all four simultaneously. This comprehensive advantage is why Google maintains its dominant position despite the constant emergence of new challengers for more than two decades.
What the Earnings Tell Us
Looking at Google’s most recent quarter, contrary to popular belief, search usage is actually growing. During their earnings call, management explicitly stated that search usage increased on a year-over-year basis.
Philipp Schindler, Chief Business Officer on search volume:
“On Search usage overall, our metrics are healthy. We are continuing to see growth in Search on a year-on-year basis in terms of overall usage. Of course, within that, AI overviews has seen stronger growth, particularly across all segments of users, including in younger users. So it’s being well received. But overall, I think through this AI moment, I think Search is continuing to perform well.”
The growth in usage increases as people discover they can ask questions they wouldn’t have asked previously. This is exactly what we’d expect as search evolves—the pie gets bigger, not smaller.
Even more telling, they reported that their AI overviews (Google’s AI-powered search features) are monetizing at the same rate as traditional search. This is crucial. From Sundar Pichai, CEO:
“For the AI overviews overall, we actually see monetization at approximately the same rate, which I think really gives us a strong base on which we can innovate even more.”
This gives us an indication that they’re on the right track to solving the monetization piece of the puzzle.
Looking Ahead
Now obviously this is still playing out, and despite the current advantages, Google has work to do. While search volume continued increasing, there’s no doubt that they’ve ceded a large portion of that incremental growth that came from incorporating AI-Generated results into their product. They need to continue improving their AI capabilities while maintaining their cost advantages. The competitive landscape is certainly more challenging than it was five years ago.
As we’ve seen with the recent announcements of DeepSeek catching up with remarkably constrained resources and Grok 3 closing the gap in record time, developing a competitive model isn’t Google’s biggest challenge. The bigger question is how they plan to monetize beyond blue links with AI-powered search generated content.
For its competitors, they need to figure out monetization, latency and accuracy piece of the puzzle while delivering the best model at scale. Which is a more difficult problem than coming up with a model that’s comparable or better than its competition.
Writing off Google in search would be premature. Its younger competitors have their own set of problems—they need viable business models that allow them to offer their best AI models to everyone quickly and accurately.
When I look at the evidence—increasing search volumes, successful monetization of AI features, infrastructure advantages, and competitors’ monetization challenges—I see a company that’s still adapting to a changing landscape rather than one being disrupted into oblivion.
The future for Google may not be monopolistic dominance, but it’s unlikely to be disrupted into irrelevance either. The year 2025 will be exciting as we see how the company navigates this evolving landscape. The most likely outcome isn’t that people stop using Google, but that they use Google and other AI-powered search tools, depending on the context and type of question.