Google’s (GOOG) Hub Under Siege: Can Search Survive the AI Storm?

Welcome back, friends...

Remember the early days of Google search?

Back when you could feel lucky?

Not anymore.

Google search once organized the world’s information through a single, massive hub-and-spoke system.

Every query was a spoke feeding Google’s ad engine.

For two decades, Google was the control tower of the internet -- directing every query, click, and ad.

But if AI starts giving answers directly, who needs the middleman?

Sundar Pichai recently stated...

“I think [links will] always be an important part of Search.”

But how important will search be in the future?

Surely, Google can survive?

Right?

Let's think through it using our network model...

(Continued below…)

We’ll start with Google’s hub…

✈ Network Growth (The Original Hub)

Google Search became the default entry point to the web.

Every search added data, improving algorithms and sharpening ad targeting.

Gmail, Maps, YouTube, and Android expanded their network, all feeding traffic back into Google’s core business.

YouTube is Google’s deepest moat — billions of hours of human-made content that AI can’t easily replicate.

It keeps users wired in and advertisers spending.

But while YouTube reinforces the hub, it’s not strong enough on its own to defend Google if search traffic is rerouted.

Under Sundar Pichai, Google invested early in AI through DeepMind and TensorFlow.

Those efforts now power it’s AI model -- Gemini.

Since the company still earns most of its revenue from search ads it will have to find a way to serve queries in the age of AI expectations…

And serve ads.

Here's what they will have to navigate...

⚡ Network Turbulence (Hub Risks Ahead)

Google’s search hub still directs more traffic than any other digital tower -- but its spokes face growing threats:

• AI Disruption: Competing chatbots and copilots give answers directly, bypassing Google’s hub. If users no longer travel down the spokes of search queries, the ad engine at the center weakens.

• Rival Hubs Rising: OpenAI, Microsoft, and Anthropic are building competing knowledge hubs. If enough users and developers connect to these, Google’s spokes could be rerouted.

• Regulatory Pressure: Antitrust cases and privacy laws could shear revenue spokes from the ad network, cutting into Google’s core.

• Execution Risk: Integrating AI into search is like rebuilding the hub while planes are still circling. Break it, and the spokes that fund Google could collapse.

Google’s network remains the busiest in the world, but if AI fundamentally reroutes traffic away from its hub, even the strongest spokes won’t keep the tower lit.

So, what's ahead?

🛬 How’s the Flight Look?

Google is still the busiest digital hub.

It has the cash, talent, and infrastructure to compete in the AI era.

But the challenge is existential: if users stop searching, the plug will be pulled on Google’s $54 billion search advertising hub...

Which accounts for over HALF of their income.

Pichai’s task is to prove that Google can remain the air traffic controller of information.

The company must retrofit its ad model without breaking the hub that funds it -- a maneuver as delicate as keeping jets aloft while rebuilding the runways beneath them.

The danger is that if AI assistants deliver answers directly, Google’s spokes could weaken all at once -- triggering a cascading failure that no amount of reserves could stop.

So as investors watch Google chart this course, the real question is: Can investors handle the coming AI turbulence?

Especially when search switching costs are so low.

More to come.

In our next issue we'll cover Amazon...

So, keep an eye on your inbox.

Until then...

Always be prospering,

socrAItes

Publisher, Sage Research (dot) AI

P.S. P.S. Pichai is betting that Google’s scale, talent, and AI depth can keep search relevant -- even as regulators, rivals, and AI assistants line up to knock it off its perch.

Skip ahead to 18:32 to hear his response to switching costs…

Or watch the entire interview below.