Google CEO Pichai Encourages Employees to Prepare for a Challenging 2025

During a recent meeting, Google CEO Sundar Pichai conveyed to his employees that the company must be prepared for a significant 2025, stating that "the stakes are high". This comes as Google anticipates heightened competition, regulatory challenges, and the rapid evolution of artificial intelligence.

At the strategy meeting held on December 18, 2023, Pichai joined other Google leaders in festive holiday attire to outline the strategic goals for the upcoming year, especially concerning AI advancements, as reported by audio obtained by CNBC.

"I believe 2025 will be pivotal," Pichai remarked. "It is crucial for us to grasp the urgency of this situation and accelerate our efforts as a company. The stakes are high, and these are transformative times. In 2025, our focus must be on harnessing the advantages of technology to address real user needs."

Some employees attended the meeting in person at the company’s headquarters in Mountain View, California, while others participated virtually.

Pichai’s remarks come after a year filled with unprecedented pressures on Google since its initial public offering 20 years ago. Although the company's search ads and cloud services showed robust revenue growth, it faced increased competition in its primary markets. Moreover, there were internal issues, such as cultural conflicts and concerns regarding Pichai’s future vision for the company.

In addition, regulatory scrutiny has intensified significantly. Recently, a federal judge determined that Google has unlawfully maintained monopoly status in the search market. In November, the Justice Department suggested that Google should be compelled to divest its Chrome internet browser business. Moreover, the DOJ accused Google of illegally controlling online advertising technology. A trial related to this issue concluded in September and is awaiting a ruling.

Simultaneously, the Competition and Markets Authority in the UK issued objections against Google's advertising technology practices, indicating they may be harming competition in the UK market.

Pichai acknowledged the heightened scrutiny faced globally by the company. "I understand that this comes with our size and success. It’s part of a larger trend where technology increasingly influences society. Therefore, it is essential that we remain focused and not get sidetracked during this critical period," he stated.

While Google’s search business still holds a dominant position, the advent of generative AI has opened up numerous new ways for people to access online information, bringing fresh competitors into the mix. OpenAI’s ChatGPT sparked a surge of interest in late 2022, leading to substantial investments, including a valuation of $157 billion for OpenAI, with plans to launch its search engine. Companies like Perplexity are launching AI-based search services and have recently secured substantial funding.

In response, Google is heavily investing to maintain its leadership position, particularly through its Gemini AI model. The Gemini app offers users various tools, including Google's chatbot features.

Pichai emphasized that "developing significant new businesses" is a vital priority, specifically highlighting the Gemini app, which executives believe could become Google's next application to achieve half a billion users. Currently, Google has 15 apps that have reached this milestone.

"We have seen promising momentum with the Gemini app, especially in recent months," Pichai shared. "However, there is still work to be done in 2025 to bridge any gaps and secure a leadership position in this area."

"Scaling Gemini on the consumer side will be our main focus next year," he later added.

Striving for Excellence

Pichai also presented a chart showcasing various large language models, with Gemini 1.5 outperforming OpenAI's GPT and other competitors.

"I anticipate there will be some competition back and forth in 2025. I believe we will be at the forefront of innovation," Pichai expressed. He acknowledged that Google has often had to catch up to new developments.

"Historically, being first isn't always necessary; what's important is executing effectively and being top-notch in quality as a product," he remarked. "This will be the essence of our endeavors in 2025."

During the meeting, executives responded to questions submitted by employees. One employee voiced the concern that ChatGPT is becoming synonymous with AI, similar to how Google is with search, and inquired about Google’s strategy for staying competitive in the coming year.

Pichai turned to DeepMind co-founder Demis Hassabis, who assured employees that the teams were prepared to significantly enhance the Gemini app and noted a rise in user numbers since its launch in February. Hassabis articulated a vision for a universal assistant capable of operating seamlessly across various domains and devices.

Additionally, Project Astra, Google's experimental version of a universal assistant introduced in May, will receive updates in the first half of 2024.

Another employee questioned whether Google could scale AI products without imposing high subscription fees, referencing other companies charging around $200 a month. Hassabis clarified, "At the moment, we don’t have plans for such a subscription model. I believe the current $20 monthly fee for advanced Gemini is a fair price, though I wouldn't entirely dismiss the idea for the future."

By the end of the meeting, Josh Woodward, head of Google Labs, took the stage amid lively music. He stated his ambition to conduct demonstrations in a short time frame.

Woodward showcased various initiatives, including Jules, a coding assistant experimenting in a trusted testing phase, which he believes represents the future direction of software development. He also introduced NotebookLM, an AI-driven note-taking product, now including podcasting features that allow users to 'call in' to a podcast, and a project called Project Mariner, enabling AI-enhanced multitasking in Chrome.

Pichai consistently reminded the team about the necessity of remaining “scrappy.” In light of a challenging phase of cost-cutting, during which approximately 6% of the workforce was reduced in 2023, there continues to be a strong emphasis on efficiency.

As of the third quarter, Alphabet's employee count stood at 181,269, reflecting a decline of about 5% from the previous year.

Pichai reminisced about Google’s founders, Larry Page and Sergey Brin, who established the company 26 years ago when cloud computing and AI tools were not yet concepts.

"In the early days, you could see how our founders made resourceful decisions regarding our data centers. They adopted a very scrappy approach in all aspects," Pichai noted. "Often, limitations lead to creativity. Not all challenges require increasing the workforce to solve them."

Pichai, 2025, AI, competition, regulation