How Perplexity Bids To Buy Google!: When startups challenge tech empires

0:00Perplexity, the AI startup has just offered over$30 billion to buy Google Chrome. Now, this is an absolutely insane offer for many different reasons. They made a bunch of concessions and said that they'll follow a bunch of basically guidelines if they were to go through with this purchase. Where did this come from? Is Google selling Google Chrome? Why is this offer happening? Is this realistic? We're going to get into all of that on the podcast today. And I think this is really interesting because this is not the first time that Perplexia has made one of these really kind of high profile, big tech acquisition offers that some people have raised their eyebrows at.

0:38So this is kind of a, this is going to be an interesting one. Before we get into all of that, I wanted to mention, if you've ever wanted to try all of the different AI models that I talk about on the podcast, I'd love for you to check out my own platform, which is called AIbox.ai. Essentially, you get access to the top 40 different AI models all in one platform. You're able to upload documents, talk to all of your different AI models in the same chat, and it's$20 a month. So instead of paying$20 for a subscription to every single model, one subscription, and you get access to everything. it's consolidated in one point, you have to go track down what conversation you're having with which model.

1:12There's a whole bunch of AI image and audio models on there. So go check it out. AI box.ai. I'll leave a link in the description. All right, let's talk about what's going on with perplexity. So this is definitely a huge move. They offered$34.5 billion in cash. This was an unsolicited offer to be fair. So Google didn't say, hey, who wants to buy us? Basically, they just said, hey, you know, well, we're going to acquire you if you want. What's happened recently is that Google has gotten themselves into a bit of an antitrust issue. And a judge ruled that Google Chrome and some of the behavior that they had around Google Chrome was anti competitive.

1:52And a lot of people are speculating that they're going to be forced to spin this out of Google. Now, the judge hasn't actually ruled that this is the, you know, the verdict and what they actually have to do. But this is just a lot of speculation. And so at this time, perplexity comes out puts out this big huge bid. Now, a lot of people are basically calling this a marketing stunt. Some people think that they're serious about it. And there's a couple interesting things. Number one, the value is absolutely insane, but it also makes a lot of sense. Perplexity is basically a search engine competitor to Google.

2:24So buying something like Chrome would obviously give them more reach for their perplexity search engine. And at the same time, perplexity is actually just put out their very own browser that competes with Chrome called Comet. This is something you got to pay$200 a month for. It's AI first. It's kind of like an agent where you can talk to it and go do tasks for you. But you can imagine the technology of Comet coming into Chrome, along with being able to put perplexity a little bit more front and center with Chrome would make this kind of a no brainer for perplexity. Now, is this a no brainer for Google?

2:53Is this something that's actually going to happen? Not everyone is convinced of that. One thing that perplexity has said is that the, you know, the terms of their offer include basically a commitment to keep Chrome's underlying engine, which is called Chromium open source. Now, Chromium is actually what's used for a lot of different web browsers. I use one called Brave, which basically just blocks ads and intrusive stuff. And Brave is running on Chromium, even Microsoft is leveraging Chromium for Microsoft Edge, their browser, you know, they used to ever made fun of their internet explorer. so they finally literally just copied google chrome's um chromium tool to to basically build their uh to build the browser now why do people use chromium i think one of the most interesting things that's the most valuable is all of the plugins that have been built onto uh google chrome you can all the extensions sorry you can actually use on these other browsers as well so it's kind of a no-brainer uh for for these you know these firms to when they create their browsers you get access to all of those plugins if you use google chrome so that's interesting Google or perplexity also included in their offer a promise to invest$3 billion into the open source project.

3:59So it's like, look, if you sell us Chrome, we'll put$3 billion more into actually working on the project. So really, that's like a 37 and a half billion dollar offer. This is insane. This is a very, very big offer, similar to what Elon Musk bought X for not too long ago, Twitter for perplexity has promised that they're not going to change the user's default browser, right? So has Google as their default browser to perplexity. They're also promising that so they do have basically their own AI power option. And they're going to not set that as a default, they'll leave Google. Google has been reached out to by multiple journalists and is not commenting on the story.

4:41I'm sure Google is just kind of embarrassed as whole things happening. They're hoping to appeal. I think the antitrust stuff they're hoping to appeal so that you know, they basically are not going to want to have to spin Chrome out. This would probably be their worst nightmare. But all of this is coming. It's actually the Department of Justice that proposed in March that Google might be forced to sell Chrome, basically because a judge ruled that they acted illegally to keep a monopoly and online search. Google has not agreed to sell Chrome. They said that they're going to fight this ruling. Spokesperson over at Perplexity said they believe that the court is soon going to set terms for the remedies maybe later this month.

5:18Google is also fighting another case where the judge ruled it was illegal and monopolized the ad tech space. The DOJ is proposing that Google be forced to divest two of its biggest products as ad tech products, or it's going to break up its ad business. So Google is basically fighting this on multiple fronts. And it's going to be interesting to see what happens. I don't know. I honestly don't know if Google is going to be able to keep keep it all together. I don't like the thought of like, I don't know, breaking up a company. But at the same time, Google is massive. They have a lot of they have a lot of different products.

5:51And if they're, you know, being anti competitive, I don't know. It would be definitely very interesting and a big interesting shakeup. So when the Department of Justice first kind of proposed that Google divest Chrome, OpenAI and Perplexity both said that they were interested in buying it. So this isn't just Perplexity. OpenAI obviously is interested too. You can see the value would be just as strong for them. Because Chrome is obviously the biggest browser in the world, it has 68 % market share, according to StatCounter. So if the courts basically rule that this is going to happen, that is going to be something that I think is going to be like a worldwide bid.

6:29I don't think perplexity is going to be the only one bidding on this. You can imagine every company in the world might be interested. What's interesting, though, is the number that they actually bid at right$34 billion. One of the other competitors to Google, which is called DuckDuckGo, it's I believe it's just kind of like no ads and like privacy first kind of Google competitor. They basically said that in April, they were testifying on this case. And they said that Chrome would be worth upwards of$50 billion. So if perplexing was actually able to get Chrome for$34 billion, that would be a massive discount.

7:01So I don't know if that's actually going to go through. But I think perplexing more just wanted to say, look, we have an offer out there to kind kind of push things along. But still, this is more than, you know, anyone else has offered. One thing that I'll say is interesting about this whole deal, and basically the reason people raise eyebrows and say this is a big marketing stunt for perplexity, is the fact that perplexity to date has only raised$1.5 billion for their company. So they've raised$1.5 billion, and they're offering an all cash deal of$34 billion. Now, their CEO says that he's found investors that will back this acquisition through them, basically.

7:35So, you know, that would be kind of crazy. But it's interesting because their company basically has not raised an insane amount of money and the valuation is only$18 billion. So they're trying to acquire a quote unquote$34 billion company, which might actually be a$50 billion company. And they're trying to do it for$34 billion with only$1.5 billion raised to date so far. And for all of these reasons, many people think this isn't actually realistic. But then the question is like, who could acquire this company, right? Who could actually pay$50 billion? What Microsoft, Amazon, Apple, like, why would we just take one massive, you know, one, one huge software from one massive company, pass it to another massive company?

8:15I just, I don't know if it I don't know, I don't know what problems we're really solving there. But maybe we are. I think another interesting thing to point out is the fact that perplexity is also apparently they've submitted a bid to merge with TikTok Trump has TikToks had this like troubled background for quite a while. Trump's first presidency before he left, he said it had to get like sold to an American company because of Chinese data like issues. And it never was. And then Biden kind of like put it on pause and everyone thought it was done. And then Biden says something similar at the end of his presidency.

8:47And it seems like it's actually going to happen now. So it'll be interesting to to see what happens with that perplexities, I guess, trying to merge with TikTok and acquire Chrome all at the same time. it could be some absolutely insane moves of one company benefiting a lot from some of the legal landscape in the United States right now. So very interesting to say the least. Hey, thank you so much for tuning into the podcast today. If you enjoyed it, make sure to leave a rating and review wherever you get your podcasts. Make sure to go check out AIbox.ai and I will catch you in the next episode.