Google dominance is cracking in the AI era


TL;DR

Google posted its fastest revenue growth since 2022 and still controls 90 per cent of search, but talent defections, rising competitors, antitrust remedies, and its own AI transformation are eroding the foundations of its dominance. ChatGPT has hit one billion users, Bing has reached the same milestone, and DuckDuckGo installs are surging.

Google’s financial performance has never been stronger. Alphabet posted $109.9 billion in revenue in the first quarter of 2026, up 22 per cent year on year, the fastest growth rate in any quarter since 2022, with search advertising revenue climbing 19.1 per cent and queries hitting an all-time high.

And yet the week before these numbers were published, the company’s stock had its worst day in over a year, falling roughly 7 per cent after two of its most prominent AI researchers defected to rivals. The paradox captures the strange position Google now occupies: it is winning on every metric that matters to Wall Street while losing ground on the ones that will matter in five years.

The talent exodus

The departures that spooked investors were not minor hires. Noam Shazeer, a vice president of engineering who co-authored the 2017 “Attention Is All You Need” paper that introduced the Transformer architecture, left to join OpenAI.

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Days later, John Jumper, a Nobel Prize laureate and Google DeepMind vice president who created the protein-folding system AlphaFold2, departed for Anthropic. The back-to-back exits reportedly erased roughly $250 billion from Alphabet’s market capitalisation.

Competitors are growing

ChatGPT surpassed one billion monthly active users in May 2026, making it the fastest app in history to hit that milestone, according to Sensor Tower estimates reported by Reuters. It consistently ranks as the top free app on Apple’s iOS store, with Anthropic’s Claude reportedly sitting in eighth place, one spot behind Google’s own Gemini.

Microsoft’s Bing reached one billion monthly active users for the first time last quarter, though its global search share remains around 5 per cent, suggesting many of those users are low-frequency or using Bing as a default. DuckDuckGo’s install rates have surged since Google’s I/O announcement in May, with growth peaking at nearly 70 per cent on iOS devices as users seek alternatives to AI-saturated search results.

Google’s own AI problem

The competitive threat is compounded by a structural one. Google’s I/O keynote in May unveiled a vision of search built around AI agents rather than the blue links that have defined its advertising model for two decades, a transformation the company says is necessary but one that risks undermining the economics that fund it.

AI Overviews now appear in roughly half of all search queries, and studies show an average 34.5 per cent drop in organic click-through rates when they are present. Google says AI Overviews monetise at a rate similar to traditional search, but the company’s own network advertising revenue, which depends on traffic flowing to external publishers, fell 4 per cent in the first quarter.

The regulatory squeeze

Google’s search share has slipped from 92.9 per cent in 2023 to roughly 89.6 per cent, the steepest decline in its history, and a US federal court has ruled that the company illegally maintained its search monopoly through exclusive default agreements. The remedies imposed in September 2025 banned exclusive distribution contracts and introduced a data-sharing requirement, though the judge rejected the Department of Justice’s request to force a divestiture of Chrome.

Both sides have appealed, with oral arguments expected in late 2026 or early 2027. Morgan Stanley analysts have estimated that mandatory choice screens alone could cost Google 5 to 8 per cent of its search traffic over three years, translating to $15 to $25 billion in annual advertising revenue at risk.

The open web question

The broader concern is what happens to the internet Google built. Nearly 60 per cent of Google searches now end without a click to any external website, and courts in Germany have already ruled that Google bears liability for the content its AI Overviews surface.

Publishers who once depended on Google for traffic are watching their referrals shrink as the company absorbs their content into AI-generated answers. The open web that Google’s advertising model was built to monetise is being hollowed out by the very AI features Google says it needs to stay competitive.

Google is betting that it can navigate the antitrust remedies, retain enough talent to stay at the frontier, and build an AI-first search product that still sells advertising at the same rates. It is simultaneously the most profitable search company in history and the one with the most to lose from the way search is changing.



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Recent Reviews


I am a recent convert to physical media — yet even as someone getting back into buying discs in 2026, I haven’t been buying Blu-rays. Like many Americans, I still pick up DVDs instead. These aren’t great times for the Blu-ray format, and don’t expect a turnaround in 2026.

Fewer new releases make their way to Blu-ray

More media is now released exclusively for streaming

Blu-ray has been around for two decades, but it never managed to fully replace, or even overtake, the DVD format it was designed to supersede. We still can’t take for granted that our favorite movies, let alone TV shows, will eventually see a Blu-ray release.

The movies most likely to come to Blu-ray are the ones that hit theaters, but a growing amount of cinema is designed exclusively with streaming platforms in mind. I recently rewatched Mississippi Masala, which led me to check in on what work Sarita Choudhury has done over the decades since. A film called Evil Eye released in 2020 caught my eye. Unfortunately, it’s only available via Prime Video. There’s no Blu-ray or even a DVD. In contrast, it’s easy to watch Michael B. Jordan in Sinners on Blu-ray, since that movie came to theaters last year.

You could say that it makes sense that a movie with a 4.8/10 rating on IMDb doesn’t see a physical release, but in the heyday of physical video, store shelves were stacked not only with just the big-budget bangers but plenty of straight-to-DVD movies as well. Now those films exist to pad out streaming catalogs instead.

Fewer big box stores stock their shelves with physical discs

Blu-ray discs have disappeared from some stores entirely

Best Buy store front
Best Buy

The format’s demise is striking. I frequent my local Best Buy quite often and don’t see any movies on display. That’s because the retailer stopped selling movies in stores several years ago. Walmart still sells them, but the selection is a fraction of what you could find ten or twenty years ago. The audience has been reduced down to the shrinking number of people whose internet at home can’t handle streaming and those who might think of themselves as collectors.

If you venture onto Reddit and visit r/Blu-ray, you will find more threads about thrift store hauls and older collections than excitement over the latest new release. Don’t get me wrong — I, too, am very excited about seeing what gems I can snag for only a couple bucks, but this shows the challenge retailers face. Increasingly, only enthusiasts are prepared to drop over $20 on a disc.

I’m not buying discs to stick them in a player

Phone on a stand playing a Netflix video Credit: Bertel King / How-To Geek

The simple truth is that most people don’t want to buy physical media. Discs don’t fit in phones, and the drives are no longer available in most laptops. Even desktop PCs lack a place to put a disk. I recently built a PC for the first time in part to digitize my media library, and I rely on an external DVD drive connected via USB. Yes, DVD, not Blu-ray. A smaller file size combined with upscaling is easier on my hard drive.

Retro nostalgia hasn’t helped Blu-ray in the same way it has aided vinyl. This is in part because most people simply don’t care all that much about video quality. Most are streaming video on Netflix and YouTube at middling settings on small screens, and many of us are acclimated to mid-range phone speakers, compared to which even the subpar built-in speakers on modern TVs sound like a huge step-up. It’s hard to convince large numbers of people to purchase an expensive version of a movie in a format that requires thousands of dollars of home media equipment to truly appreciate.

4K Ultra HD is in an even worse position

It’s been a decade, yet few people own these discs

The 4K Ultra HD Blu-ray format is an enhancement, rather than a replacement, of the Blu-ray discs that first appeared in 2006. Debuting in 2016, the 4K Ultra HD format supports the max resolution of a 4K TV.

4K TVs were still somewhat of a novelty ten years ago, but they’re cheap and commonplace today. Still, people aren’t demanding 4K-quality Blu-ray movies as a result. These discs are still less common than 1080p ones, which are themselves still outnumbered by DVDs.

This isn’t merely a matter of consumers preferring the cheaper option. Often, 4K simply isn’t a choice, or it’s one that arrives significantly later, like the Switch port of a PC title. Some recent films, like Exit 8, are slated to see a physical release over the summer yet will still be in 1080p when they do. Adoption of the newest format has been that slow.

The industry isn’t helping itself, either. 4K Ultra HD Blu-ray discs come with DRM and aren’t easy to play on a modern PC, further limiting potential growth. They do not want anyone pirating these super high-quality versions. When you consider that some of these 4K Blu-rays have an AI upscaling problem, you’re paying more for what may not even be the best version.​​​​​​​


Blu-ray is seeing fewer releases, is available in fewer places, and is less accessible in the ways many of us want to watch TV shows and movies in 2026. With our portable devices getting better and internet speeds getting faster, it’s hard to see physical video staging a turnaround, even if we’re still a long way off from it going away entirely.



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