Have you looked at the results for any commercial query, something like [sofa beds] or [hard drives]? It is basically 100% ads. Anything where the user is intending to spend money, they show only ads, and have all the top producers in the world bid against each other for who gets featured, and Google captures essentially all surplus value in the transaction.

My wife is an investor, and one of her portfolio areas is pharmaceuticals. A couple of portfolio companies have reported that it's becoming basically impossible to make any money off of a new product, because you need to advertise it to reach the customer, and Google will skim all the excess producer surplus off as you compete with other startups serving the same market.

It's basically the perfect business model. They own the path to the consumer, which means they own the economy.

I'd also recently hired someone out of Google Search, and they said that the only queries that "legacy" (non-AI-mode) search cares about are commercial-seeking queries, and the only metric they optimize for is ad conversions on those. It literally is thousands of people whose only job is to get you to click more ads.

Gemini in search (AI Overview) is likely the most used LLM in the world, and ads can still surface around it.

(googler, opinions are my own. I know nothing about this outside of external info)

Why would llms replace search? It was a crazy take in 2023 and is still one today. Suppose there are no search engines and you want to find some headphones. How exactly are you doing this with llms?

I have access to ChatCPT, Gemini, Claude and you know what I still do 99% of the time?

I open Google Search. If I want an LLM, I click “AI Mode.”

I only bother to open Gemini or ChatGPT or Claude if it’s a “big research thing” which is almost never.

Same way all big companies do, start changing what "search" means and including things under "search" that you might not think belongs there.

It literally doesn't matter why search revenue is growing. What is observably true is that it is that it is growing, as has it has been, throughout the LLM era.

Absent additional information, no one else can identify the false assumption underlies a strong belief that this should not be case. But something is flying in the face of the facts, and has been for a while. So, yeah, might want to take a look at those priors.

For most people Google Search is the LLM they're using.

Another way to think about this is that LLM based search actually grows the entire pie for search and so multiple players can all be growing at the same time.

The real losers are publishers, blogs, forums etc. Instead of traffic going to them that traffic is being turned into more search queries and more LLM responses.

4 top paid search results (take up the entire screen)

AI overview (organic for now?)

3 organic results (below the fold)

2 paid search results

Image results

1 organic result

If I don't run paid ads I don't get leads I rank organically for a lot of the keyphrases I'm bidding on (top 3 results)...organic 0-2 calls a week, paid ads 4-6 calls a week (niche business).

I have been wondering the same thing myself. I manage google ads for a living and I don't understand why I still have a job.

Personally I use AI chatbots to help me make every purchase decision I have to think about.

Not everyone is using LLMs and people who do are probably using Google for higher value and targeted search.

Do chatbots click ads?

Many LLM agents do automated web searches.

Monopoly pricing power

Ad targeting llms continue to improve