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Mozilla ‘Failed’ Bet on Yahoo Takes Spotlight in Google Trial

Mozilla ‘Failed’ Bet on Yahoo Takes Spotlight in Google Trial

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In 2014, Mozilla Foundation made a significant decision to change the default search engine in its Firefox browser from Google to Yahoo. This bold move was based on Yahoo’s promises of a better search experience for Firefox users. However, in hindsight, Mozilla’s bet on Yahoo can be considered a significant failure, resulting in a degradation of the user experience.

The Rise and Fall of Mozilla's Yahoo Experiment

Mozilla’s Chief Executive Officer, Mitchell Baker, candidly admitted the failure of the Yahoo partnership during a videotaped interview from 2022, which was presented as part of Google’s defense in the Justice Department’s antitrust trial. This decision to switch to Yahoo’s technology was initiated under the leadership of Yahoo’s CEO at the time, Marissa Mayer, who pledged to make a substantial investment in Mozilla.

However, as Mitchell Baker emphasized, “That bet failed.” The once-promising search experience Yahoo was supposed to provide to Firefox users began to deteriorate. This significant shift in default search engine providers marked a unique case in the browser industry, making it a focal point in the ongoing antitrust trial between Google and the Justice Department.

The Broken Promises of the Yahoo-Mozilla Partnership

Mozilla ‘Failed’ Bet on Yahoo Takes Spotlight in Google Trial

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One of the primary reasons behind Mozilla’s decision to switch from Google to Yahoo was the financial incentive. Yahoo agreed to pay Mozilla a minimum of $375 million, surpassing Google’s annual offering of $276 million. Additionally, Yahoo promised to reduce the number of ads and offer less user tracking compared to Google. These promises were appealing to both Mozilla and its users.

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However, as time passed, Yahoo failed to live up to its commitments. Instead of providing a better user experience with fewer ads and reduced tracking, Yahoo began showing more advertising, ultimately diminishing the quality of the search experience for Firefox users. This shift in Yahoo’s approach not only affected Mozilla’s revenue but also resulted in a less desirable browsing experience for Firefox users.

In conclusion, Mozilla’s experiment with Yahoo as the default search engine in Firefox stands as a glaring example of a promising partnership that went awry. The decision to make a significant bet on Yahoo, based on their promises, ultimately resulted in a failed venture, leading to a deteriorated user experience and raising questions about the reliability of search engine partnerships in the tech industry. This case serves as a significant point of contention in the ongoing antitrust trial, with both Google and the Justice Department using it to support their respective arguments.

Google’s 2019 ‘Code Yellow’ Blurred Line Between Search, Ads

Google’s 2019 ‘Code Yellow’ Blurred Line Between Search, Ads

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Emails presented in the Justice Department’s historic antitrust hearing in opposition to the search engine giant revealed that in February 2019, the previous head of search at Alphabet Inc.’s child firm Google complained to coworkers that his team was getting excessively involved with advertising for the beneficial aspects of the product and company.

Google’s 2019 ‘Code Yellow’ Blurred Line Between Search, Ads

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To allow its engineers to develop on Google’s search engine without being constrained by the team whose aim is to maximise advertising income, Google keeps a firewall across its search and ad teams. However, in February 2019, when evidence from the antitrust trial was made public on Tuesday, Google secretly issued a “Code Yellow” due to worries that the business could miss its quarterly targets for search revenue.

Documents state that during the seven-week crisis, engineers from Google’s search as well as Chrome browser divisions were transferred to investigate the reason behind the slowdown in user inquiries.

Justice Division Ben Gomes, a previously employed Google employee, was contacted by the firm to defend itself and demonstrate the progress it has achieved in search, especially in the mobile space. On interrogation, however, attorney David Dahlquist of the Justice Department brought to light the conflicts that existed between Gomes’ search department and its marketing competitors.

The goal of the interrogation was to disprove Google’s claims that its search team only concentrates on enhancing user experience and is occasionally drawn into the advertising space, where the Department of Justice claims Google has been able to hike prices without facing opposition.

In its eighth week of trial, the fundamental question is whether Google used billions of dollars to suppress competition and retain its monopoly over internet search, in violation of the law.

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Google Chief Executive Officer Pichai refutes the Department of Justice's Claims of Evidence Erasure.

Google refuted the notion that the firm’s advertising revenue targets had an impact on results from searches and innovation in a statement.

“The organic results you see in search are not affected by our ads systems or by the ads we show for a query,” said Peter Schottenfels, a Google spokesperson.

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Google claims that its improved offering has allowed them to grab almost 90 percent of the search engine market, and that the general public has benefited from its innovations in internet search. However, emails shown in court on Tuesday indicated that several important members of the search team at the business expressed worry about Google prioritising revenue above innovation.

Alphabet Shares Fall After Cloud Unit Misses Estimates

Alphabet Shares Fall After Cloud Unit Misses Estimates

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Alphabet Inc. faced a significant blow as its shares plummeted by the most in a year on Wednesday following the release of its quarterly earnings report, which revealed weaker-than-expected profit in its cloud computing unit. This has raised concerns about Alphabet’s competitive standing in the cloud computing market, which is considered pivotal to its future success.

Alphabet Shares Fall After Cloud Unit Misses Estimates
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As Google’s flagship search business matures, investors have been looking to the cloud unit to spearhead growth. However, the cloud unit reported operating income of $266 million, falling significantly short of the estimated $434 million, igniting worries about Alphabet’s ability to catch up with cloud computing giants such as Amazon.com Inc. and Microsoft Corp.

Max Willens, an analyst with Insider Intelligence, emphasized the unpredictable nature of the cloud computing business, stating, “Cloud computing is a much lumpier business than advertising and one where Google is facing stiff competition. While the traction it has among AI startups may bear fruit in the long run, it is not currently helping Google Cloud enough to satisfy investors.”

Alphabet’s shares took a hit, dropping as much as 8.9% to $126.40 in New York, marking the most substantial decline since October 2022. This downturn follows a promising year, during which the shares had gained 57% up to the previous day’s close.

Ruth Porat, Alphabet’s President who is currently serving as the company’s acting Chief Financial Officer, attributed the cloud unit’s disappointing performance to some customers’ cost-cutting measures.

Nevertheless, Alphabet’s overall earnings report for the third quarter was generally strong. The company reported sales of $64 billion, surpassing the analysts’ consensus of $63 billion. The net income amounted to $1.55 per share, surpassing Wall Street’s estimate of $1.45 per share.

The search advertising business, where Google holds a dominant position, reported revenue of $44 billion, exceeding the average analyst projection of $43.2 billion. However, Google’s leadership must contend with challenges stemming from the rise of generative AI chatbots that offer more conversational responses to user queries.

Despite the cloud unit’s struggles, Alphabet’s leadership has affirmed their commitment to operating more efficiently and investing in emerging opportunities such as artificial intelligence. CEO Sundar Pichai stated, “We’ll do everything that is needed to make sure we have the leading AI models and infrastructure in the world, bar none.”

Additionally, Alphabet’s ongoing legal battle with the U.S. Department of Justice, concerning allegations of search market power abuse, has contributed to the uncertainty surrounding the company’s future. Analyst Evelyn Mitchell-Wolf from Insider Intelligence noted that the outcome of the trial could influence investor confidence in the sustainability of Google’s business model.

Also Read: Snap Returns to Revenue Growth on Improved Ad Business

On a more positive note, YouTube reported $8 billion in revenue, surpassing the average estimate of $7.8 billion. This indicates that the video-sharing platform is benefiting from the rebound in digital advertising spending.

Alphabet’s Other Bets, which encompass moonshot projects like Waymo (self-driving cars) and Verily (life sciences), generated $297 million in revenue but incurred a $1.2 billion loss, in line with analysts’ projections. Despite the headwinds facing its cloud unit, Alphabet continues to explore new avenues for growth and innovation beyond its core businesses.

Google’s Pichai Decried Bad ‘Optics’ of Search Engine Deal With Apple

Google’s Pichai Decried Bad ‘Optics’ of Search Engine Deal With Apple

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In a revealing twist in the ongoing Justice Department’s antitrust case against Alphabet Inc.’s Google, emails from 2007 have emerged, featuring concerns raised by Google’s current CEO Sundar Pichai about the company’s deal with Apple Inc.

Google’s Pichai Decried Bad ‘Optics’ of Search Engine Deal With Apple
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The emails, submitted as evidence in the case, showcase Pichai’s apprehensions about the lack of choice for users in selecting a search engine in Apple’s Safari browser. At the time of the emails, Pichai was overseeing Google’s Chrome browser, and he expressed discomfort with the agreement to pay Apple for being the pre-selected search option. “I know we are insisting on default, but at the same time I think we should encourage them to have Yahoo as a choice in the pull-down or some other easy option,” Pichai wrote.

The crux of the Justice Department’s case is the allegation that Google has been paying substantial amounts to Apple and other smartphone makers, including Samsung, in revenue-sharing agreements to stifle competition from rival search engines. The agreements ensure that Google remains the default search option on browsers and smartphones.

The Justice Department claims that Google pays over $10 billion annually for these contracts, though the exact figures are confidential. Google, however, denies that these agreements impede competition, asserting that users can easily opt for alternatives.

Key negotiator Joan Braddi, Google’s vice president for product partnerships, testified on Tuesday about the agreement with Apple. During questioning, the prosecutor raised concerns about the benefits of Google search compared to the cost of supporting Apple, its major competitor in mobile operating systems. Braddi, who negotiated the initial deal in 2002, stated that the agreement between Google and Apple had no limits on how Apple utilized the money received.

The 2002 deal, which started without any monetary exchange, evolved into a revenue-sharing arrangement in 2005. It subsequently expanded to include the iPhone in 2007 and the iPad in 2010. Braddi disclosed that amendments were proposed by Apple in 2007, 2009, and 2012, seeking more flexibility on the search default. In 2014, an amendment was signed allowing Apple to use other search engines in some countries.

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Interestingly, the 2014 amendment took 17 months to negotiate, emphasizing concerns about potential diversions of queries to other companies. Braddi clarified that the intention was not to obstruct Apple’s services but to ensure that the search engine was used in a “substantially similar” manner.

As the case unfolds, questions linger about the financial impact of the revenue-sharing on Apple’s operating income. Google has been monitoring Apple’s earnings calls since 2018 to gauge the significance of the revenue share, but exact figures remain undisclosed. The trial continues, shedding light on the intricacies of these behind-the-scenes dealings between tech giants.

Google’s New Virtual Assistant to Include Bard AI Tools

Google’s New Virtual Assistant to Include Bard AI Tools

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In a strategic move towards advancing artificial intelligence capabilities, Google has announced the imminent release of a revamped version of its virtual assistant, powered by the cutting-edge Bard artificial intelligence technology. This development is poised to elevate the capabilities of the Google Assistant, allowing users to seamlessly navigate and tackle more intricate tasks with unprecedented ease.

Google’s New Virtual Assistant to Include Bard AI Tools
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The innovative offering, aptly named “Assistant with Bard,” is set to undergo a test phase in the near future before its official rollout to the general public in the coming months, according to an announcement made by the tech giant on Wednesday. This update aims to imbue the Assistant, known for aiding users on Android and Google devices in task completion and information retrieval, with functionalities reminiscent of Bard—a chatbot designed by Google to rival the widely acclaimed ChatGPT from OpenAI.

In a blog post accompanying the revelation, Sissie Hsiao, a Google vice president, expressed enthusiasm about the transformative potential of generative AI in creating a more intuitive, intelligent, and personalized digital assistant.

“As technology continues to evolve, generative AI is creating new opportunities to build a more intuitive, intelligent, personalized digital assistant,” wrote Hsiao.

As major players in the tech industry compete to harness the power of AI advancements, Google is proactively integrating this technology across its extensive portfolio of products. In the preceding month, Alphabet Inc.’s division revealed plans to incorporate its Bard chatbot into services such as Gmail, Maps, Docs, and YouTube.

The announcement was made during a hardware event hosted at Google’s Pier 57 Manhattan office, where Rick Osterloh, Google’s devices chief, expounded on the company’s broader strategy of infusing generative AI into various apps and services. Osterloh disclosed that, in the next year, the Google Home app is slated to introduce experimental features. These features include summaries of activities around users’ front doors and the ability to inquire about the status of packages using natural language.

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Google Assistant is already a formidable player in the virtual assistant arena, competing with the likes of Apple’s Siri and Amazon’s Alexa. Its expansion into AI capabilities reflects the industry’s recognition of AI as the new frontier in this fiercely contested market. Google Assistant can be found across a spectrum of devices, including smartphones, smart speakers, smartwatches, and other computers.

With the integration of Bard AI technology, Google is poised to redefine the capabilities of its Assistant, promising users a more intelligent and intuitive digital companion for their daily tasks. As the virtual assistant landscape evolves, this move underscores Google’s commitment to staying at the forefront of innovation in artificial intelligence.

Ex-Googler’s Struggling Search Startup Becomes Antitrust Cautionary Tale

Ex-Googler’s Struggling Search Startup Becomes Antitrust Cautionary Tale

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It’s difficult to compete with Google’s search engine. Ask every startup that has given it a go.

Ex-Googler’s Struggling Search Startup Becomes Antitrust Cautionary Tale
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Prosecutors are focusing their case on the accounts of startup companies who have tried fruitlessly to establish a foothold in the sector as the US Dept. of Justice attempts to persuade a court that Alphabet Inc.’s Google has established an unlawful monopoly in the web search industry. Neeva Inc. is one such business. It was established by ex-Google employees and debuted in 2019 to much acclaim before unexpectedly shuttering its product early this year.

Sridhar Ramaswamy, a co-founder of Neeva, remembered how the business considered it could provide customers with a better search experience by charging them for a subscription instead of serving up ads, which he thought had eventually degraded the overall quality of Google’s product while testifying Monday and Tuesday in the federal courtroom in Washington. However, despite adding additional AI features to the product that could provide succinct answers to inquiries, Ramaswamy and his co-founders were unable to establish momentum with consumers and ultimately came to the conclusion that they couldn’t create a sustainable business.

“People who tried our AI experience genuinely loved it. It was a better, easier, sleeker experience,” Ramaswamy said on the stand Monday. But an economic slowdown, coupled with Google’s paid-for placement on smartphones, meant Neeva couldn’t “grow our subscriber base fast enough,” he added.

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Despite this, several search businesses have persisted in making an effort, particularly in light of the prospects presented by emerging technology to revolutionize how users use the internet. The success of OpenAI’s ChatGPT has generated discussion in Silicon Valley regarding a new search paradigm in which software powered by artificial intelligence would provide authoritative answers to queries submitted by users instead of the well-known webpage of links that Google popularised. Although some business owners contend their startups have a greater chance to ride the wave, Google has already mobilized teams within to redesign its search engine for this age of change.

“We are moving towards a new segment, a new kind of internet where you are basically getting answers served to you instead of links,” said Aravind Srinivas, a former Google researcher whose startup, Perplexity AI, offers a conversational web-search product. “And that’s a market that will not be dominated by Google,” he said in an interview.

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