In 2016 Google CEO Sundar Pichai announced that “in the long run, we’re evolving in computing from a ‘mobile-first’ to an ‘AI-first’ world.”
In 2018, he famously told Kara Swisher that AI is “one of the most important things that humanity is working on. It’s more profound than, I don’t know, electricity or fire.”
It’s generally over-looked that he opened that statement by saying “We don’t take a very optimistic view of AI” and closed by responding to Swisher’s comment that “fire is pretty good” with “(fire) kills people too, we have learned to harness fire for the benefits of humanity but we have to overcome its downsides too.”
And yet, just over four years later Pichai, by then also CEO of Google’s parent company, Alphabet, issued a ‘code red’ and directed multiple department heads including those in charge of research, trust, and safety “to switch gears to assist in the development and launch of AI prototypes and products.”
This directional switch took place only three weeks after the launch of OpenAI’s ChatGPT product.
At the time, The New York Times warned that “because these new chat bots learn their skills by analyzing huge amounts of data posted to the internet, they have a way of blending fiction with fact” and “that could turn people against Google and damage the corporate brand it has spent decades building.”
The Times also quoted University of Washington professor Margaret O’Mara saying, “For companies that have become extraordinarily successful doing one market-defining thing, it is hard to have a second act with something entirely different.”
That was in late 2022, as of mid-year 2025, it is clear that Pichai has damaged Google’s brand and its core search product in a seemingly competition with OpenAI.
As I tried to understand what Pichai was doing, my initial framework was Cory Doctorow’s “enshittification” concept defined as when “vendors create high-quality offerings to attract users, then they degrade those offerings to better serve business customers, and finally degrade their services to users and business customers to maximize profits for shareholders.”
Over the past year I’ve found Ed Zitron’s analysis of Google’s decision-making has deepened my understanding of WTF Pichai is up to. I’ll come back to Zitron in a moment, but for those new to his work, I’d recommend giving these three pieces a quick skim:
The Rot Economy
The Man Who Killed Google Search
The Era Of The Business Idiot
I’ve also found pioneering AI researcher Gary Marcus’ work very useful — he flagged most of the limitations of LLM AI decades ago and has been consistently vindicated in his skepticism that the current OpenAI and Alphabet approach to AI will truly prove “as important as fire.” We’ll come back to Marcus too.
But first I want to touch on an idea that Naked Capitalism readers have seen recently in another context via Curro Jimenez: nihilism.
Curro was quoting the French sociologist Emmanuel Todd’s analysis of Israel’s recent behavior in Gaza and Iran and this quote jumped out at me: “Perhaps in the unconscious depths of the Israeli psyche, being Israeli today is no longer about being Jewish — it’s about fighting the Arabs.”
I would argue that for Pichai and those remaining at Google under his leadership, being Google today is no longer about being the dominant search engine — it’s about fighting OpenAi/ChatGPT.
On Wednesday, I’ll be applying Todd’s formulation to the current leadership of the Democratic party which is no longer about being the party of the working class but rather it’s about fighting off the progressive wing of the party.
Now, let’s dive into Ed Zitron’s explanation of why Google is willing to risk its incredibly lucrative core search business and maybe even destroy the open web itself in a quest to compete with Open AI.
Zitron is an effective polemicist so let’s let him cook a little:
Google no longer provides the “best” result or answer to your query – it provides the answer that it believes is most beneficial or profitable to Google. Google Search provides a “free” service, but the cost is a source of information corrupted by a profit-seeking entity looking to manipulate you into giving money to the profit-seeking entities that pay them.
The net result is a product that completely sucks.
…That’s because Google has, like every major tech company, focused entirely on what will make revenues increase, even if the cost of doing so is destroying its entire legacy. Google has announced their own “Bard AI” to compete with Bing’s ChatGPT integration, and I’ll be honest – I feel a little crazy that nobody is saying the truth, which is that Google broke the product that made them famous and is now productizing fixing their own problem as innovation.…Venture capital and the public markets don’t actually reward or respect “good” businesses or “good” CEOs – they reward people that can steer the kind of growth that raises the value of an asset. …Sundar Pichai isn’t paid $280 million a year because he’s a “good CEO.” After all, Google has all but destroyed its search product. He’s paid because he finds ways to increase the overall growth of the company (even while their cloud division still loses money), and thus the stock goes up.
Zitron expanded on these ideas in his “Business Idiot” piece:
Our economy is run by people that don’t participate in it and our tech companies are directed by people that don’t experience the problems they allege to solve for their customers, as the modern executive is no longer a person with demands or responsibilities beyond their allegiance to shareholder value.
The incentives behind effectively everything we do have been broken by decades of neoliberal thinking, where the idea of a company — an entity created to do a thing in exchange for money —has been drained of all meaning beyond the continued domination and extraction of everything around it, focusing heavily on short-term gains and growth at all costs. In doing so, the definition of a “good business” has changed from one that makes good products at a fair price to a sustainable and loyal market, to one that can display the most stock price growth from quarter to quarter.
Ewan Morrison elegantly summarized why Pinchai’s commitment to AI is so riskly to its search business and the Open Web itself:
One drop of sewage in a glass of water turns the entire glass into sewage.This is happening with AI hallucinated facts on the internet. AI systems have 48% error margins & are turning our historical, news, philosophical & scientific info on the net into sewage.Do not drink it. pic.twitter.com/nN0dhV9Dg2
— Ewan Morrison (@MrEwanMorrison) June 19, 2025
And like Captain Ahab, Pinchai knows he must have a crew just as dedicated to his suicidal mission as he is. He might not be nailing a gold coin to the mast and demanding loyalty oaths, but he is aggressively pushing buy-out offers on Googlers who are not down with the program:
Remember Google is offering buyouts to employees who aren’t all-in on how the company is doing things and it’s “AI first” direction. Sadly, I have to think that still working for Google at this point means they support what’s happened and how the company intends to become an an answer engine.
— Katherine Argent (@effthealgorithm) June 21, 2025
Let me wrap with a couple of paragraphs from Freddie de Boer about the issues the whole of tech faces and why it thinks AI is the answer:
the hype is a phenomenon driven by needs that are fundamentally financial in origin. The tech companies need a new suite of products that can restore their eroding profitability and inspire the public the way that the public was inspired in the late 2000s and early 2010s; the financial sector and investors need the tech companies to be the unicorn stocks that they once were. As usual with speculative capitalism, the tail is wagging the dog. When hockey stick growth does not emerge naturally from reality, it will be invented.
Media hype about AI, the almost literal absence of any countervailing narrative, the relentless way that the stodgiest publications inflate the threats/hopes that have been invested in these technologies… it’s all downstream of the desire to feel about tech the way people did in the Obama era and the demand from the moneyed to have the right lottery tickets to buy. A lot of people who are used to getting what they want are looking to let the good times roll again, and “AI” is precisely the kind of vague instrument into which they can throw those hopes. Anyone who points out that the emperor has no clothes is simply told that they don’t understand the technology, and every year that goes by that human life is not seriously disrupted by this technology is just a minor delay. Rinse and repeat.
In future posts, I’ll look at other players in the AI space — OpenAI, Meta, Microsoft, Amazon, and Apple.
