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This (innovator's dilemma / too afraid of disrupting your own ads business model) is the most common explanation folks are giving for this, but seems to be some

This (innovator's dilemma / too afraid of disrupting your own ads business model) is the most common explanation folks are giving for this, but seems to be some sort of post-rationalization of why such a large company full of competent researchers/engineers would drop the ball this hard. My read (having seen some of this on the inside), is that it was a mix of being too worried about safety issues (OMG, the chatbot occasionally says something offensive!) and being too complacent (too comfortable with incremental changes in Search, no appetite for launching an entirely new type of product / doing something really out there). There are many ways to monetize a chatbot, OpenAI for example is raking billions in subscription fees.

nemothekid 3y ago
>There are many ways to monetize a chatbot, OpenAI for example is raking billions in subscription fees. Compared to Google, OpenAI's billions is peanuts, while costing a fortune to generate. GPT-4 doesn't seem profitable (if it was, would they need to throttle it?)
- ro_sharp 3y ago
  > GPT-4 doesn't seem profitable (if it was, would they need to throttle it?) Maybe? Hardware supply isn’t perfectly elastic
- nequo 3y ago
  Wouldn't Google be better able to integrate ads into a "ChatGoogle" service than OpenAI is into ChatGPT?
  - exitheone 3y ago
    The cost per ad is still astronomically different between search ads and LLMs
    - varjag 3y ago
      There could be an opposite avenue: ad-free Google Premium subscription with AI chat as a crown jewel. An ultimate opportunity to diversify from ad revenue.
      - disgruntledphd2 3y ago
        There's not enough money in it, as Google's scale. Especially because the people who'd pay for Premium tend to be the most prized people from an advertiser perspective. And most people won't pay, under any circumstances, but they will click on ads which make Google money.
        varjag 3y ago
        YouTube does it, at Google scale. And these same people do pay $20/mo for ChatGPT anyway.
        nemothekid 3y ago
        YouTube isn't comparable - YouTube revenue is roughly 30B/year, while Search revenue is roughly 175B/year. Advertisers are willing to pay far more than $20/mo per user, combined with the fact that search costs way less per query than inference.
        nequo 3y ago
        The low operating margin of serving a GPT-4 scale model sounds like a compelling explanation for why Google stayed out of it. But then why did Microsoft put its money behind it? Alphabet's revenue is around $300bn, and Microsoft's is around $210bn which is lower but it is the same order of magnitude.
Karrot_Kream 3y ago
Google gets much more scrutiny then smaller companies so it's understandable to be worried. Pretty much any small mistake of theirs turns into clickbait on here and the other tech news sites and you get hundreds of comments about how evil Big Tech is. Of course it's their own fault that their PR hews negative so frequently but still it's understandable why they were so shy.
- logicchains 3y ago
  Sydney when initially released was much less censored and the vast majority of responses online were positive, "this is hilarious/cool", not "OMG Sydney should be banned!".
  - knowriju 3y ago
    You have clearly not heard about Tay and Galactica.
- Symmetry 3y ago
  It's understandable that people at Google are worried because it's likely very unpleasant to see critical articles and tweets about something you did. But that isn't really bad for Google's business in any of the ways that losing to someone on AI would be.
  - IX-103 3y ago
    Google is constantly being sued for nearly everything they do. They create a Chrome Incognito mode like Firefox's private browsing mode and they get sued. They start restricting App permissions on Android, sued. Adding a feature where Google maps lets you select the location of your next appointment as a destination in a single click, sued (that's leveraging your calendar monopoly to improve your map app). Google has it's hands in so many fields that any change they make that disrupts the status-quo brings down antitrust investigations and lawsuits. That's the reason why Firefox and Safari dropping support for 3rd party cookies gets a yawn from regulators while Google gets pinned between the CMA wanting to slow down or stop 3rd party cookies deprecation to prevent disrupting the ads market and the ICO wanting Google to drop support yesterday. This is not about bad press or people feeling bad about news articles. Google has been hit by billion dollar fines in the past and has become hesitant to do anything. Where smaller companies can take the "Elon Musk" route and just pay fines and settle lawsuits as just the cost of doing business, Google has become an unwieldy juggernaut unable to move out of fear of people complaining and taking another pound of flesh. To be clear, I don't agree with a strategy of ignoring inconvenient regulations, but Google's excess of caution has severely limited their ability to innovate. But given previous judgements against Google, I can't exactly say that they're wrong to do so. Even Google can only pay so many multi-billion dollar fines before they have to close shop, and I can't exactly say the world would be better off if that happened.
rs11 3y ago
Monetizing a chatbot is one thing. Beating revenues every year when you are already making 300b a year is a whole different ball game There must be tens of execs who understand this but their payout depends on keeping status quo

nemothekid 3y ago

>There are many ways to monetize a chatbot, OpenAI for example is raking billions in subscription fees. Compared to Google, OpenAI's billions is peanuts, while costing a fortune to generate. GPT-4 doesn't seem profitable (if it was, would they need to throttle it?)

ro_sharp 3y ago
> GPT-4 doesn't seem profitable (if it was, would they need to throttle it?) Maybe? Hardware supply isn’t perfectly elastic
nequo 3y ago
Wouldn't Google be better able to integrate ads into a "ChatGoogle" service than OpenAI is into ChatGPT?
- exitheone 3y ago
  The cost per ad is still astronomically different between search ads and LLMs
  - varjag 3y ago
    There could be an opposite avenue: ad-free Google Premium subscription with AI chat as a crown jewel. An ultimate opportunity to diversify from ad revenue.
    - disgruntledphd2 3y ago
      There's not enough money in it, as Google's scale. Especially because the people who'd pay for Premium tend to be the most prized people from an advertiser perspective. And most people won't pay, under any circumstances, but they will click on ads which make Google money.
      - varjag 3y ago
        YouTube does it, at Google scale. And these same people do pay $20/mo for ChatGPT anyway.
        nemothekid 3y ago
        YouTube isn't comparable - YouTube revenue is roughly 30B/year, while Search revenue is roughly 175B/year. Advertisers are willing to pay far more than $20/mo per user, combined with the fact that search costs way less per query than inference.
      - nequo 3y ago
        The low operating margin of serving a GPT-4 scale model sounds like a compelling explanation for why Google stayed out of it. But then why did Microsoft put its money behind it? Alphabet's revenue is around $300bn, and Microsoft's is around $210bn which is lower but it is the same order of magnitude.

Karrot_Kream 3y ago

Google gets much more scrutiny then smaller companies so it's understandable to be worried. Pretty much any small mistake of theirs turns into clickbait on here and the other tech news sites and you get hundreds of comments about how evil Big Tech is. Of course it's their own fault that their PR hews negative so frequently but still it's understandable why they were so shy.

logicchains 3y ago
Sydney when initially released was much less censored and the vast majority of responses online were positive, "this is hilarious/cool", not "OMG Sydney should be banned!".
- knowriju 3y ago
  You have clearly not heard about Tay and Galactica.
Symmetry 3y ago
It's understandable that people at Google are worried because it's likely very unpleasant to see critical articles and tweets about something you did. But that isn't really bad for Google's business in any of the ways that losing to someone on AI would be.
- IX-103 3y ago
  Google is constantly being sued for nearly everything they do. They create a Chrome Incognito mode like Firefox's private browsing mode and they get sued. They start restricting App permissions on Android, sued. Adding a feature where Google maps lets you select the location of your next appointment as a destination in a single click, sued (that's leveraging your calendar monopoly to improve your map app). Google has it's hands in so many fields that any change they make that disrupts the status-quo brings down antitrust investigations and lawsuits. That's the reason why Firefox and Safari dropping support for 3rd party cookies gets a yawn from regulators while Google gets pinned between the CMA wanting to slow down or stop 3rd party cookies deprecation to prevent disrupting the ads market and the ICO wanting Google to drop support yesterday. This is not about bad press or people feeling bad about news articles. Google has been hit by billion dollar fines in the past and has become hesitant to do anything. Where smaller companies can take the "Elon Musk" route and just pay fines and settle lawsuits as just the cost of doing business, Google has become an unwieldy juggernaut unable to move out of fear of people complaining and taking another pound of flesh. To be clear, I don't agree with a strategy of ignoring inconvenient regulations, but Google's excess of caution has severely limited their ability to innovate. But given previous judgements against Google, I can't exactly say that they're wrong to do so. Even Google can only pay so many multi-billion dollar fines before they have to close shop, and I can't exactly say the world would be better off if that happened.

rs11 3y ago

Monetizing a chatbot is one thing. Beating revenues every year when you are already making 300b a year is a whole different ball game There must be tens of execs who understand this but their payout depends on keeping status quo