Google's most serious rival is a start-up

The AI boom of the past two years has largely been a two-horse race. Alphabet's Google and Microsoft-funded OpenAI have duked it out for customers, while Amazon.com and Meta Platforms have nibbled at the margins for market share.

- Parmy Olson Bloomberg

But at least one new company has emerged as an outsider with a chance of challenging their oligopoly.

More than 15 million people, according to a spokeswoman, are regularly using Perplexity AI, an "answer engine" that competes with Google's search and advertising business. The website and app shot up in value over the course of 2024, from $1 billion at the start of the year to $9 billion in December when it closed a $500-million funding round. Its founder, Aravind Srinivas, is a consummate negotiator who has plugged himself deeply into Silicon Valley's network while diffusing tension with competitors and critics.

Going up against Google has always looked like a suicide mission. Around 90% of online searches globally are conducted on its site. Microsoft's Bing, after incorporating ChatGPT two years ago, has barely made a dent in Google's market share, remaining at just 4%. Yahoo's usage has dwindled. A promising AI start-up called Neeva, run by a former Google ad executive, closed down in 2023 after four years of trying to compete with Google.