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Will Search Be Generative AI or Blue Links? Actually, It’s Both.

The real search battle isn’t gen AI vs. links, it’s when to show each format.

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 ten 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.

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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.

Asked about its approach, a Google spokesperson said that “people want quick access to information and the ability to dive deeper on the web — Google Search delivers all this, while continuing to send traffic back to a wide range of sites.”

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. “It depends on what category you're talking about,” Lanzone said. “We're talking to everybody and considering all options. We have a very deep partnership with Microsoft. So there's a lot we will do with them as well.”

Perplexity’s Srinivas, whose search engine stands outs among a new wave of generative AI startups, likes the setup. His lack of business model gives him more flexibility than most to experiment with the ratio of traditional to AI results. “No business model, no margins,” he said, declaring a potential advantage.

We can now put aside the notion that search will be one format or the other. All these experiences will converge. The real competition will be how much of each every search engine provides.

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Marissa Mayer is the CEO and co-founder of Sunshine, the former CEO of Yahoo, and a longtime Google executive. She joins Big Technology Podcast to discuss why she's betting on consumer tech, building a new array of products including Sunshine Contacts and the newly released Shine, a photo sharing app. Mayer discusses how AI impacts building for consumers today, and whether independent tech stands a chance against big tech. We also discuss the state of OpenAI, Google's competitive position, the lessons from Mayer's Tumblr acquisition, and what motivated her to found a company. Tune in for a fun, in-depth conversation with one of tech's leading executives.

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