01

On May 7th, 2025, Alphabet’s stock price plummeted 7.5%.

Hundreds of billions of dollars in market value were wiped out.

This sharp drop was not due to the financial report not meeting expectations or any product failure.

But it comes from data released by its once most trusted ally, Apple.

In an antitrust trial involving Google’s parent company Alphabet’s Internet search business, Apple Senior Vice President Eddy Cue disclosed a very critical data:

Google Searches on Safari declined for the first time in April”

He also added:

AI search engines will eventually replace standard search engines such as Google”

This sounds thrilling,

In fact, this is true, because this change is enough to subvert Alphabet's entire profit model.

You know, Google pays Apple more than $20 billion every year just to maintain the default search entrance status in iPhone and Mac browsers.

In other words, a large part of Google's "search cash cow" relies on Apple's default position at the distribution layer.

Now, Apple not only stated the fact that traffic has declined, but also hinted that it is working on its own AI search system, such as exploring the possibility of adding AI search engines like Perplexity to its default Safari web browser.

This means that Google not only has to face competition, but may also lose its most core mobile entrance.

02

In the past year, AI assistants such as ChatGPT, DeepSeek, and Grok have been rapidly reconstructing the way humans obtain information:

You can think back to when you wanted to know "Which country is the best to travel to in May?", did you stop opening Google and ask DS directly?

When you want to know how to fix a bug, instead of sifting through a bunch of links, do you accept modification suggestions directly generated by AI?

You are even using AI to write resumes, make plans, check news...

All this, bypassing Google.

Gartner predicted at the beginning of 2024:

By 2026, total global usage of traditional search engines will decline by 25%.

At this time last year, "Wired" magazine published an article "It's the End of Google Search As We Know It". The article stated that Google's vision is to make search smarter, more proactive, and more like an AI assistant.

But there's a problem:

It dare not do too well.

03

You would say, Google obviously has AI, why not just build a new platform that completely subverts the search experience, like OpenAI?

Well, it's not that it can't be done, it's that it can't be done with all its strength.

Because it’s in The Innovator's Dilemma.

“The more dominant a company is, the more likely it is to miss out on the next wave of technology because it has to protect old world profit sources.”

First of all, Google’s core business model is keyword advertising.

For example, if you search for "buy running shoes", it will display the bidding prices of Adidas and Nike.

And if you directly ask "Which running shoes are suitable for me", Gemini answers a summary, and you no longer click on the link or search for the next item - no one pays for this advertisement.

So Google is caught in a paradox: the better it does, the more it will cut off its own cash flow; but if it doesn't kill itself, others will have already done so.

The second is organizational inertia.

Search is the core of Google's empire. This is not only the department that makes the most money, but also has the largest say and the strongest engineering culture. The Gemini team is considered a “rising star”. You can imagine how difficult it is for the AI ​​team to say to the search team in a highly hierarchical technology giant: "Your system should be replaced."

Even if Larry Page returns in person, it will be difficult to quickly promote a "revolutionary" strategic shift in an organization that has already achieved great success.

We always say “what makes you, will break you”.

OpenAI has no old business pressure and can rush into the future without any burden; Apple has no advertising system and can completely reconstruct the search entrance; but Google is tied to "yesterday's success".

This is the cruelest fate of innovators:

You built the kingdom with your own hands, but you must burn it with your own hands before you can win again.

04

Google's stock price plummeted, releasing a signal that may have been captured by the market:

"Search" is no longer the only starting point for humans to obtain information.

In the next few years, we may see:

Apple launched the AI-integrated Siri search system in iOS. ChatGPT became a one-stop assistant for "search + content generation + recommendation". New companies such as Perplexity and DeepSeek redefined the search experience. Advertisers began to shift budgets from keyword advertising to recommendation positions at the model entrance. Users changed from "I search" to "it understands me", from Pull information to Push intelligence...

Google’s empire was not built by algorithms, but by becoming the “starting point for human thinking.”

Every time you open the Google search box, you are giving yourself up to its guidance.

While more and more humans are beginning to hand over the power of “first question” to AI nowadays.

Because this generation is no longer searching, they are talking.