Google may lose $3 billion in annual revenue and stocks fall before trading begins.
Microsoft’s search engine, Bing, may replace Alphabet’s Google as the default search service on Samsung devices, according to the New York Times. This switch could cost Samsung nearly $3 billion of Google’s annual revenues. According to a report by Bloomberg, Bing’s threat to Google’s search dominance has become more credible in recent months with the addition of OpenAI technology to provide responses similar to ChatGPT to user queries.
After this news was revealed, Alphabet’s shares fell by 1% during pre-market trading in New York, while Microsoft’s shares rose by less than 1%.
Samsung shipped 261 million smartphones in 2022, all of which run on Google’s Android operating system, according to IDC data. The Korean company has long-term partnerships with both Microsoft and Google, and its devices come preloaded with a library of apps and services from both, such as OneDrive and Google Maps. Negotiations are ongoing and Samsung may decide to keep Google as its default provider, according to the report.
Google is working on several projects to update and refresh its search services to avoid losing market share. These include adding artificial intelligence features to its current offerings as part of a project called “Magi,” which involves more than 160 people, according to The Times.
For its part, Lara Levin, a spokesperson for Google, said in a statement that Google is excited to bring new AI-powered features to its search engine and will share more details soon.