Episode Details

It’s now almost 6 months since Google declared Code Red, and the results — Jeff Dean’s recap of 2022 achievements and a mass exodus of the top research talent that contributed to it in January, Bard’s rushed launch in Feb, a slick video showing Google Workspace AI features and confusing doubly linked blogposts about PaLM API in March, and merging Google Brain and DeepMind in April — have not been inspiring.

Google’s internal panic is in full display now with the surfacing of a well written memo, written by software engineer Luke Sernau written in early April, revealing internal distress not seen since Steve Yegge’s infamous Google Platforms Rant. Similar to 2011, the company’s response to an external challenge has been to mobilize the entire company to go all-in on a (from the outside) vague vision.

Google’s misfortunes are well understood by now, but the last paragraph of the memo: “We have no moat, and neither does OpenAI”, was a banger of a mic drop.

Combine this with news this morning that OpenAI lost $540m last year and will need as much as $100b more funding (after the complex $10b Microsoft deal in Jan), and the memo’s assertion that both Google and OpenAI have “no moat” against the mighty open source horde have gained some credibility in the past 24 hours.

Many are criticising this memo privately:

* A CEO commented to me yesterday that Luke Sernau does not seem to work in AI related parts of Google and “software engineers don’t understand moats”.

* Emad Mostaque, himself a perma-champion of open source and open models, has repeatedly stated that “Closed models will always outperform open models” because closed models can just wrap open ones.

* Emad has also commented on the moats he does see: “Unique usage data, Unique content, Unique talent, Unique product, Unique business model”, most of which Google does have, and OpenAI less so (though it is winning on the talent front)

* Sam Altman famously

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