Google I/O in May 2023 was the most AI-dense product keynote the company had given. PaLM 2, Bard improvements, Duet AI, a new Pixel phone with on-device AI, and announcements across every product line. It was a response to Microsoft's OpenAI moment.
PaLM 2 as the foundation
Google announced PaLM 2 as the foundation model powering its AI products. PaLM 2 is a better coder and multilingual model than PaLM 1. It powers Bard, Google Cloud's Vertex AI generative capabilities, and on-device features in Pixel products. Google positioned it as a family with different size variants (Gecko for on-device, Bison for cloud), similar to the approach OpenAI had taken with GPT-4 and GPT-3.5.
Bard's rehabilitation
Bard had launched in February 2023 with a factual error in its demo video that caused Alphabet's stock to drop $100 billion in a day. By I/O, Bard was substantially improved. It connected to Google Search for current information, could work with images, and showed better reasoning on coding tasks. The reputation problem from the launch error was harder to fix than the technical problems.
Duet AI in Workspace
Google announced Duet AI for Google Workspace: AI assistance in Docs, Sheets, Slides, Meet, and Gmail. Writing assistance in Docs, formula generation in Sheets, slide design suggestions, meeting summaries. This is Google's direct response to Microsoft 365 Copilot. Both products were announced in 2023 and both represent the integration of LLMs into the productivity suite that most knowledge workers spend most of their time in.
The search integration question
The integration of generative AI into Google Search, announced as Search Generative Experience, raised questions about the economics of the search advertising model. If users get answers directly rather than clicking through to websites, the ad click-through model is under pressure. Google's approach was to include links in AI answers and show ads alongside them. How users respond to this format will be watched carefully through 2024.