The 25-year-old internet giant, valued at $1.4 trillion (£1.1 trillion) revealed a glimpse of its AI-first redesign at its annual I/O conference yesterday.

The move saw Alphabet’s (Google’s parent company) stock price jump over 4% before markets closed yesterday. 

Among the changes will be Google workspace enhancements including AI-assisted Gmail, Docs, Sheets, and Slides, as well as a Google maps ‘immersive view’, offering live and immersive views of places.

Most significantly, Google will integrate a ‘conversational’ interface for its search engine, allowing users to engage in elaborate Q&A-style chats instead of searching for a list of links. 

The move puts Google in direct competition with Microsoft, which is collaborating with OpenAI to revamp its own internet search technology.

Following Microsoft’s announcement of AI-powered offerings in February, Google had been striving to catch up and innovate its search engine, which has remained relatively unchanged since 1998. 

However, both tech giants may find themselves trailing behind the open-source community in the broader AI arms race, as suggested by an alleged anonymous internal document from Google.

The document – made public by Semi Analysis, a consulting firm – has garnered attention from media outlets like The Guardian, Bloomberg, and Business Insider. It highlights that open-source models exhibit superior speed, customizability, privacy, and ‘pound-for-pound’ capability.

“Plainly put, they are lapping us. Things we consider ‘major open problems’ are solved and in people’s hands today,” it reads. “While our models still hold a slight edge in terms of quality, the gap is closing astonishingly quickly.”

The announcement of new AI-powered tools also comes on the backdrop of widespread fears about the proliferation of fake images and the potential for misinformation. Current AI algorithms can produce convincing, but factually incorrect text, which could be an issue if users turn to search engines for in-depth answers instead of news sites or internet publishers. 

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Google CEO, Sundar Pichai, emphasized the company’s “bold and responsible approach,” to reimagining its core products. 

In a blog post about the generative AI Google search, Elizabeth Reid, VP and GM of search at Google said: “We’ve trained these models to uphold Search’s high bar for quality, and we will continue to make improvements over time. They rely on our hallmark systems that we’ve fine-tuned for decades, and we’ve also applied additional guardrails, like limiting the types of queries where these capabilities will appear.”

Initially the revamped version of Google will not be the default option for all users, but will be part of an experiential version called Search Labs. Using this, users can choose to try out the new AI-assisted tools, and toggle back to the original version any time.