The Google Exec Reinventing Search in the AI Era

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0:33Today on Bold Names, Liz Reed. She oversees Google search and is something of a Google lifer. Having been there more than 20 years, she has seen some of the biggest moments for this company. And now she's overseeing one of the company's biggest transitions ever, the shift to AI. They're dealing with a bunch of competitors, especially in chatbots like OpenAI and Perplexity. It has to do all of this while continuing to make money from advertisements. And throw in our discussion with Liz about the so-called dead internet theory. And I would say this is a doozy of a conversation. Absolutely. And I can't wait to get into it.

1:09But first, I want to read a little note. News Corp, the owner of The Wall Street Journal, has a commercial agreement to supply content to Google platforms. Now that that's out of the way, let's get into it. From The Wall Street Journal, I'm Tim Higgins. And I'm Christopher Mims. This is Bold Names, where you'll hear from the leaders of the bold name companies featured in the pages of The Wall Street Journal. Today we ask, how does Google search survive in the new world of AI chatbots and answer engines? Liz, thanks for making the time. You oversee a product that's used by billions of users every day.

1:49And you are also involved in this transformation with AI, which I have to think is challenging, uncertain. You've been at Google for more than 20 years. You've seen other new technologies. I'm wondering where this AI moment ranks in that history. Is it the biggest shift yet? I do think it's the most profound shift. Certainly, there have been quite a number of big ones. I think the shift to mobile particularly stands out. But for search, like it's an information product, right? And this is a technology shift that is fundamentally changing about information. So the technology shift is sort of most directly connected to the product itself.

2:31And I think one of the things that's really just exciting about it is you have a lot of engineers and product managers that have dreamed for years of things they wanted to build. Right. Why can't we do this? Why can't we answer this question? Why can't we make the information available to people in every language? And it finally feels like we have a technology that sort of makes those things possible. I'm glad you mentioned in every language, right? Because sort of the less known history of today's large language models, the initial focus for this kind of AI was language translation. And then it turned out it could be used for chatbots.

3:07For good reasons, Google didn't release their initial language models. Then in 2022, we had the chat GPT moment, and it felt like it was kind of a hair on fire moment for Google internally. A lot has happened in the interim. Google has caught up, quote unquote, in a lot of ways. But it also feels a little bit like Google is still catching up. Do you feel like that's the case? I can't talk to the company as a whole, but I would say in search, this is a space where we've been using AI in search for quite some time. You go back to the time of transformers, and we brought in search with BERT. And BERT being your original, one of the transformers.

3:48Yeah, one of the original transformers. Which was incorporated into search results before ChatGPT was even a thing. Yeah. Initially, the technology was such that things like latency and quality felt promising, but to the point where we had them sort of more behind the scenes. They were in ranking. They were in sort of small features across. And it's only in the last couple of years that the tech has really been there where you can bring it in a much more forward way to users. I think in Search we have, to your previous point about billions of people use this, this is a product that has a sense of trust that people have built over years.

4:23And we really want to maintain that. I think it's been an evolution in Search over the last several years, but it's exciting to be able to bring it more forefront to the user and unlock new capabilities that way. I think that OpenAI and these other startups are painting kind of a vision for the future where chat AI is the way people find information and learn about information. I have to imagine that you see it slightly different. And I'm wondering what you think is Google's edge with its own platform in this kind of AI future. Yeah, so I think there's a few aspects of it. I do think this ability to have more conversational, stateful interactions will continue in the future.

5:06I think that's very powerful when you're talking. Could you define stateful for our non-geek listeners? Sure. Do we understand what you just said three minutes ago and what you said yesterday and what you said last month? Right. You know, if you have a human relationship, you don't feel like every time you meet someone, you're meeting someone for the first time. Right. So that's exciting on the tech. But on the other hand, I would say some of these will paint this picture that sort of your future information is only just talk to a model. You're just going to interact with this AI bot, and that's all at once.

5:39And what we've seen and what we believe in is there's this great mix of pulling AI to make that information easier to enable these things. But also people still want to hear from other people. They're not ready to delegate all their fashion advice, all of the things they would previously go to influencers or trusted editorial, just to a model. Not just based on the accuracy of the data, but also on sort of like what makes us human, that this is special to hear from somebody that you connect to, that you relate to, their unique take on something. And so we think about using AI to sort of enhance search to enable you to get the quick answers, but also to dig deeper around the web.

6:20And so we think that's really an important part with search, that you can continue to actually hear from other people, to hear from other sites and publishers you trust, and trying to figure out how we best bridge them together. And right now, users can go on to google.com, and they can see some of this bridge, if you will. It's the AI overview, right? So it gives you kind of a snapshot of kind of what you're looking for, right? I've used it many times. You can also go deeper. There's other links there that you can kind of go down the rabbit hole. Though at the beginning, there was some funny faux pas, if you will.

6:55I think you get asked about them a lot. I remember this one columnist over at Wired noting that when they were asking it, the year kept saying it was 2024. for. Kind of embarrassing, but also I'm not quite sure if somebody had just woken up and they're like, I need to go to the AI and ask what year it is that they wouldn't know what year it is. But whatever. It really gets to this issue of trust. Tim, what are you saying about what I do when I wake up in the morning? It's, you know, I guess it gets to this issue of trust though, right? And knowing the information is correct. Do you think that users are harsher in judging Google when it does this versus some of these other startups where they don't have a personal relationship or they don't have experience with?

7:36Or are we making much to do about nothing? Or do the user actually care? I think people hold Google to a high level of responsibility. And I think that's a good thing, right? Like people really rely on us. And we see sometimes that people go to chatbots, and they will come to us to check the answer. Search is a very broad space. And people's questions are very broad. And some things people really, really care about, you know, down to the wire, the exact data and other things people just want to get the gist of something. And sometimes what's interesting with these tools is that people aren't using search or other tools simply just to get the answer.

8:13Sometimes they're using it to help them brainstorm, to help them get started, right? And so if your goal is to get started, not to finish, even if you can't help them all the way, it's better to help them get started and then allow them to figure out where to double check and to figure out where to go deeper than it is to be like, sorry, I'm not 100 % sure. So go away and, you know, try something else. Right. And so we have to think about that balance constantly. Liz Reed says that users want both AI and human generated content in search. But how are things shaking out for publishers in the era of AI overviews?

8:49One of the things that's always true about Google search is that you make changes and there are winners and losers, right? Like that's true on any ranking update. That doesn't in any way discount what it means for those individual publishers that are losers, right? Stay with us.

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9:46So search is a big revenue generator for you, but you are changing the nature of search with these AI overviews? I mean, in my own experience, they have been getting more accurate. They are extremely convenient. A lot of times when I use them, I don't have to click through on subsequent links unless I feel the need to fact check what the overview is telling me. The data suggests that millions of other people are engaging in the same behavior. So they're not going to the canonical 10 blue links. They're not clicking through. How is this change in behavior from people searching the internet through Google to demanding answers affecting your revenue?

10:24So actually the revenue with AI overviews has been relatively stable accordingly. And the way to think about that is some queries may get less clicks on ads, but also it grows overall queries. So people do more searches, right? And so those two things end up balancing out. Part of the thing to think about is like, what are the ads, okay? So if the ads are for shoes, you might get an answer in AI overviews, but you still have to buy the shoes, right? Like none of the AIs ones substitute the need for the actual pair of shoes. So you're still likely to click through, even if you're doing research initially and then you click through.

11:01So sorry, can you walk me through exactly how, you said some queries you're getting fewer clicks. So if I'm just like, you know, what is the relationship between these two celebrities? You know, like is one the child of another? I'm looking up Nepo babies or something, you know, one of my hobbies. that's not going to get a click through but it doesn't another friday night with memes it's that or world war one naval history okay tim so i would say so what one thing i would say is um uh most queries don't have any ads at all yeah right okay so your celebrity example probably didn't show any ads in the first place okay it probably doesn't show any ads after right um and so that query is sort of unaffected by ads okay um a lot of ads show on more commercial queries and they show for ones where you have often interest in a commercial service.

11:48Okay. And so in that case, the AI review is more likely to be helping give you context. And then you may continue on with an ad accordingly. The AI overviews, we show ads both above and below AI overview. So sometimes the AI review shows up above the ads, which will, that's more likely to affect the ad click through. Sometimes the ads show above. But overall, one of the things that's sort of counterintuitive to many people is that the number of searches they will issue is actually not fixed. It's not every question that you think of you bother to ask. You get a question in your head and you sort of do this very split second calculation, which is like, is it worth me picking up my phone?

12:32And so many things you just don't bother to pick up the phone at all for. But if you lower the barrier for getting that information, if you believe that you can get the answer quickly, if you believe you can get it reliably easily, then you'll ask more questions. OK, you think about like a very easy example of this is with lens. OK, if you previously saw. And Google lens is the thing where you take a picture of something and search Google for it. Okay, so if you previously saw a great handbag or a beautiful flower on the side of the road, and you had to think about describing that with text, no way were you going to figure out how to do that unless you were extremely motivated.

13:10So you just let it go, right? But then you have Google Lens and you ask the question, you get an answer. And so you start asking more questions. We saw this with AI overviews as well. That ease of being able to ask a question, that ability to ask a question where maybe the information wasn't on any single web page, but it was across multi-web pages, that lowered the bar for people. And so people started doing more searches. And so the increase in searches sort of compensates for the impact on ads, such that we end up roughly at the same point. And ad revenue has actually been up. You're painting a very rosy picture here that things are well.

13:47I mean, that's your job. But on the flip side of that, I think it can be confusing out there in the marketplace because Because part of the success of Google search is that it's seen as this very big player, some would say a monopoly. In fact, a federal judge has ruled that way. And this judge found that there were basically two areas where Google was basically engaging in antitrust. That suit involves its core business, online searches. Google currently controls roughly 90 % of the world's Internet searches. In getting into the remedies part of that case, in some ways, it's seen as Google being given a reprieve in part because this federal judge, and I want to quote from it, he's looking at the case for search for Google.

14:36And he said, quote, the emergence of generative AI changed the course of the case. And in fact, one of your partners at EQ at Apple, he had some testimony that kind of contributed to that decision, this idea that Google's place in the world with search was slipping because of the threat of AI. And so, yeah, based on data from searches within Safari, I believe he said those searches were going down. Right. So what are the stakes? Are the stakes as high as the judge would be making it? That Google is at this kind of precipice of potential failure or is search having a bright future? So I think there is more competition than ever before, for sure.

15:16And also I think search has a very bright future. I think this is really an expansionary moment where the number of people who will ask questions, the amount of questions that people will ask overall, everywhere, is growing tremendously. And so both Google can grow very successfully and other people can grow successfully. It's not sort of this one or the other zero sum game in the same way, because people sort of assume these things are zero sum. But actually, because making these things easier causes people to ask more questions, to bring more of their needs, to get more help, to take that project that felt a little overwhelming and they're like, oh, I'm never going to get to that.

15:53I don't have enough time and suddenly feel like they can embark on it. Right. Then the whole space grows. And lots of people can grow at the same time. It's interesting. I hear what you're saying about the idea of growing the pie, that everybody's looking for information. I think when I look at some of your rivals, they want to grow the pie, but they want to eat all the pie. I mean, their idea, some of these ideas, it's like you have your personal assistant who's just going to be, you're going to be asking questions and feeding, and that's going to be the ecosystem you live in. And that's like a different vision of the world than we have currently.

16:23And I just wonder if, in some ways, Google faces the innovator's dilemma, right? You've got a foot in the old search business, evolving it, but also getting into the chat kind of mentality of how you interact with information. When you kind of look over the history of industries that have dealt with really disruptive change, sometimes when they deal with kind of the straddling or the hybrid approach, they get left behind, right? We can go through a whole list of them. I wonder if that is the moment you're in, or do you see it differently? Well, I think there's a couple of things I would say. One, Google Search has handled many transitions.

16:58People asked similar questions when the time of mobile came, right? Like, oh, will you actually be able to have an ads product in the mobile space? The phone is so small. You're such a desktop product. Are you going to be able to transition? And it actually proved very healthy for us, right? I think in general, things for which the tech changes play very well to Google Strength. I also think Google has sort of multiple things in the space, right? We have both the evolution of search and we have Gemini, which is sort of more of a chat app from its origin across. Like that's a different version of straddling is to ensure that you both evolve your mainstay and you disrupt yourself from within and use that together to tackle the new challenges ahead.

17:41There have been multiple reports that since Google launched AI overviews, click throughs have fallen. Now, you talked earlier about your aggregate data. you aren't seeing this phenomenon as far as I understand it. But, you know, I've talked to individual publishers who said that, you know, with the last algorithm update, you know, they saw traffic drop 45%. Are we conflating two things here? Because Google does regularly update the search rankings and the sort of underlying algorithm that determines where publishers are going to be and how much traffic they're going to get. or is it that while you're seeing overall click-through rates in aggregate for Google stay the same for individual publishers it's spiky and there are winners and there are losers in the AI overview era?

18:30So I would say a couple of things. One of the things that's always true about Google search is that you make changes and there are winners and losers right like that's that's true on any ranking update that doesn't in any way discount what it means for those individual publishers that are losers, right? But the other thing that's going on is there's a behavioral shift that is happening in conjunction with the move to AI. And that is a shift of who people are going to for a set of questions, okay? And they are going to short form video. They are going to forums. They are going to user generated content a lot more than traditional sites.

19:08This is particularly true with younger users, okay? They're going to podcasts, right? Thank God. Bold names where you get your ideas. So people have served on this. And this is particularly with youth. They show this even more. And they do that at some level for news, but often for things that the world doesn't necessarily think of as hard news, but publishers are used to thinking about, right? Where are you getting your lifestyle advice? Where are you getting your cooking? Are you getting your cooking recipes from a newspaper? Are you getting your cooking recipes from YouTube, right? And so there's all these underlying dynamics as well.

19:46And we are seeing a shift that is people going to more of these forums, user generated content, short form video, audio, podcasts. And that is coming at the expense of some other more long form traditional web. And so that's oftentimes what people are seeing. You can say in an aggregate, an individual publisher could be affected by any number of different factors going on. Maybe there was a different publisher that was higher ranking, maybe users change. But we do have to respond to who users want to hear from, right? Like we are in the business of both giving them high quality information, but information that they seek out.

20:24And so we have over time adjusted our ranking to surface more of this content in response to what we've heard from users. So to be clear, there's a push and there's a pull. So the pull is users want more of this kind of content, short form video. Let's use that as a shorthand for all the different types of media that you just named. But there's also a push. You're changing your algorithm because you see the trend going there? You see it from users, right? We do everything from user research to we run an experiment. And so you take feedback from what you hear from research about what users want.

21:01You then test it out and then you see how users actually act. And then based on how users act, the system then starts to learn and adjust as well. Will the Internet be consumed by AI generated content? After the break, how Google's efforts to eliminate spam shape its approach to keeping the AI slop at bay. It is hard work, but we spend a lot of time and we have a lot of expertise built on this such that we've been able to keep the spam rate of what actually shows up down. And as well as we've sort of expanded beyond this concept of spam to sort of low value content, right? That's next.

21:47I think one of the biggest fears among publishers and these independent creators out there is that they aren't going to survive this kind of coming change, right? And then I guess what happens? What happens? Who's fueling those AI overviews at that point? Do you guys talk about that inside of Google? or what's the kind of conversation about the future of where information will come from if some of these established pillars go away? So I think from the search side, like we really care about the health of the web more than anybody else, right? Like it is essential, not simply for AI reviews, but for the product.

22:25So what we spend a lot of time thinking about is how do we surface them effectively in this world of AI? How can you continue to innovate and understand what it is? We've started doing more with inline links, okay, that allows you to say according to so-and-so with a big link for whoever the so-and-so is, right? We could say according to bold names, okay, here's what they have to say and then click throughout, right? Building both the brand as well as the click-through. The bolder the better, in my opinion. Yeah, we'll make sure we put bold names in big, bold font as well, of course. So continuing to think about questions like that.

23:04Are there ways that we can surface videos in new ways within some of these experiences if people are interested in videos across? Another thing we've been doing recently is working on more personal features. So we did something with top stories. We did something with Discover, allowing you to say, these are the sources you most trust. So if you have a subscription to somebody, can you get their articles at the top of your top stories by selecting that? if you have particular people you love to follow, so that we can strengthen the connection between sites and creators and the audiences they like, and really make it easier for them to access that content.

23:43Are you familiar with dead internet theory? I have not heard that specific phrase before, although I feel like I've heard a lot of phrases, but go ahead. So dead internet theory is that most of what's on the internet is already AI generated because that's what people will click on and that's what will rank and no one can really distinguish ai generated content from human generated content i guess outside of video but even there you know i don't personally believe this is where we are now it does feel like it is a warning about where we could go though and i wonder if you are at all concerned that the web the health of the web, the web could remain healthy and that people will still search, but it could be unwell in the sense that more and more of it is essentially AIs training on themselves and that the content you're directing people to because of the erosion of other parts of this ecosystem that you've created that people depend on.

24:46Are you concerned about that at all? I think it's very important that we continue to surface high quality content. Okay. The web is extremely big. You're right that AI generated makes it even bigger. And so we've worked for years on this question about how do you get rid of spam? Okay. Now, AI generated content doesn't necessarily equal spam, but oftentimes when people are referring to it, they're referring to the spam version of it, right? Or phrase AI slop, right? This content that feels extremely low value across. Okay. And we really want to make an effort that that doesn't service. Now, you can have a beautiful AI generated with an artist image, okay, in response to home decor inspiration ideas, which I wouldn't consider AI slop.

25:33I would consider just, you know, a tool like Photoshop to go create it. That may still be great to surface it, right? Somebody created it. But what we see is people want content from that human perspective. um they want that um that sense of like what's the unique thing you bring to it okay um and actually what we see on what people click on on ai overviews is content that is richer and deeper okay that surface level ai generated content people don't want that because if they click on that they don't actually learn that much more than they previously got they don't uh trust the result anymore across.