The argument we’ve been making (internal and external to MSFT) since the first u

The argument we’ve been making (internal and external to MSFT) since the first use of video cards for calculating weights in the early 00s, is that if AI produces the search results we want, there is no place for advertising, and that kills Google’s revenue stream.

Google’s problem is finding a value prop if advertising isn’t it. MSFT can float search without advertising indefinitely, as it has a revenue source embedded in an unbreakable network effect.

And google had the first mover advantage and sat on it for years, precisely because they understood what we had almost two decades ago.

There is an obvious counter to MSFT revenue stream for both Google and Apple. Apple is riding on the iPhone and Google on ad revenue. But these are both vulnerable.

While I’ve never had a problem getting access to MSFT senior staff, or doing major deals with there, it’s been impossible to work with google, because they’re more arrogant (overconfident) than MSFT in the 90s.

We change when we have to. And given how lame Claude is vs ChatGPT, and the direction they’re taking with it to avoid doing what they ought to, even if it’s a threat to search, the future ought to be interesting.

Right now, it’s rather fun watching the industry try to brute force the LLMs into something other than a UI for a bottom up AI. And while progress is impressive, they have to solve the logic and reasoning issue ,world model issue and adversarial competition issue. And that’s before we get to needling neuromorphic hardware to end the memory and training compute problems.

Cheers

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