Yahoo is one of the most visited websites on the planet. It’s the most popular news site in the U.S., with more than 3 billion visits each month. It’s second in sports, second in email. It’s a still-kicking, veritable online hub of information. And at the very top of its homepage, it has a search bar.
That highly-visible search bar presents Yahoo with a fascinating choice today: whether to respond to search queries with AI-generated, ChatGPT-like answers, or with standard, Google-style lists of blue links. And when I asked Yahoo CEO Jim Lanzone which one it would be, he surprised me. The answer is both.
“You can do both,” Lanzone said in a recent conversation on Big Technology Podcast. “For some queries, it is just generative AI. And for some, it is just a link. And every version in between.”
Indeed, the narrative that we’ll either get 10 blue links or a few AI paragraphs in search results is wrong. All major search engines’ plans for generative AI today — including those that are “generative AI first” — are to infer our intent based on our queries and then provide an answer in the style fitting the request. It won’t be generative AI or old style Google. It will be both.
“Generative 100% makes no sense,” Aravind Srinivas, CEO of gen AI search engine Perplexity told me. Perplexity, he said, will show a blend of answers.
Along with Yahoo and Perplexity, Google and Microsoft are seeking to determine the intent of your queries before deciding which results format to show you. Bing is already including its AI-generated ‘Copilot’ answers at the top of some results pages, with the traditional results below, a Microsoft spokesperson told me. Google is also showing its still-experimental Search Generative Experience answers only on some results.
The real forthcoming search war, then, will hinge on how well these search engines can infer our intent, and how often they’re willing to show expensive generative AI answers. “Truly understanding user intent and knowing when to fire a gen AI answer vs. just links is a hard problem too,” Srinivas told me.
“It depends on the query,” Lanzone said. “That’s going to unleash a different tree structure for what you might present, or what you might do, that as you follow that down it just continues to evolve.”
And if all search engines are able to determine our intent perfectly — a non-trivial problem — they’ll then have to determine whether it’s worth showing generative AI answers in every situation that calls for them. “The challenge is cost,” Lanzone said. “These are very expensive answers to generate.”
Not only are generative AI answers costly to display — they require orders of magnitude more computing resources to produce — they also don’t have a proven advertising business. So, search engines displaying AI responses will have to both pay more to serve them and potentially sacrifice ad revenue. It’s an interesting dilemma, and a conundrum for Google, which made $175 billion in search revenue last year. Google is now considering charging for generative AI results, the Financial Times reported this week.
A representative from Google said that people want fast access to information and the ability to explore more on the internet. Google Search provides this and still directs traffic to many different websites.
Yahoo's search results are currently powered by Microsoft's Bing, and the company is in evaluation mode as it decides how to approach this new era of search. Lanzone mentioned that their approach depends on the category and they are considering various options while maintaining a deep partnership with Microsoft.
Srinivas from Perplexity, whose search engine stands out among a new wave of generative AI startups, likes the setup. His lack of business model allows him more flexibility than most to experiment with the ratio of traditional to AI results. He stated that having no business model and margins could be an advantage.
We can now discard the idea that search will be exclusively one format or the other. All these experiences will come together. The real competition will be how much of each format every search engine offers.
