It can be argued that Google was the greatest company ever created. The internet landscape has been dominated by Google for decades, guiding users to their desired information with simplicity and efficiency.  However, the recent controversy surrounding Google’s artificial intelligence project, Gemini, has spotlighted significant challenges that go beyond mere technological hiccups to touch on deeper issues of ethical AI development and changing user expectations.

I. Gemini?

Google introduced Gemini as a forward leap in artificial intelligence, aimed at cementing its place as a frontrunner in the AI space. This project was meant to showcase Google’s prowess in innovation, with features including advanced image generation capabilities. But soon after its launch, Gemini found itself at the center of a storm, drawing criticism and prompting a broader discussion about the role of AI in our society.

Unfolding of the Controversy

The core of the controversy emerged when Gemini’s image-generating feature started producing historically inaccurate and biased images. These included portrayals of racially diverse figures in contexts where historical accuracy would suggest otherwise, such as Nazi-era German soldiers and the Founding Fathers of the United States as shown in Figure 1. This issue quickly caught the public’s attention, sparking debate on social media and drawing criticism from various quarters. 

Figure 1: Gemini Errors, source

In response, Google’s CEO, Sundar Pichai, issued a memo to employees, acknowledging the offensive nature of the AI’s outputs. Pichai said in the memo: “I want to address the recent issues with problematic text and image responses in the Gemini app (formerly Bard). I know that some of its responses have offended our users and shown bias — to be clear, that’s completely unacceptable, and we got it wrong.” The company temporarily halted Gemini’s image generation feature, signaling the seriousness with which Google was taking the backlash and its commitment to addressing the underlying issues.

Google’s Response and the Broader Implications

This incident did more than highlight a glitch in Google’s AI; it raised important questions about the ethical development of AI technologies, the responsibility of tech giants in shaping public discourse, and the need for transparency and accountability in AI’s evolution. The Gemini controversy serves as a critical moment for Google, challenging the company to balance its ambitions in AI with a commitment to ethical standards, especially regarding sensitivity to historical accuracy and representation. It underscores the need for a careful approach to AI development, one that considers potential societal impacts and strives to align with principles of fairness and inclusivity.

As Google moves forward from this episode, the lessons learned from Gemini will likely influence its approach to AI and prompt reflection on how best to navigate the complex interplay between innovation, ethics, and societal expectations. This moment marks a turning point, not just for Google but for the tech industry at large, as people demand better from such powerful global forces.

For instance, the CTO of OpenAI was recently interviewed on the topic of whether or not they had used data from YouTube in the model’s training. In light of the question of data ownership, she answered that she did not possess that knowledge. Logically,  the official tasked with training the Large Language Models (LLMs) would possess information on what kind of data was used. Some users have even reported that if you do not speak on the text-to-speech ChatGPT model, it sometimes outputs “Thank you for watching”. This phrase is almost exclusively associated with YouTube, commonly used in video outros. Hence, multiple issues and ever-important questions have been circulating en-masse in the media: ‘Who owns public data?’ ‘Is it ethical to use them uncontrollably to train LLMs?’

I. Beyond the Surface: Unpacking the Real Shift

The Shift in User Expectations

At its core, this issue transcends the immediate flaws of the Gemini AI. While the inaccuracies and biases that surfaced are significant, they hint at a larger, more fundamental transformation in how people seek and consume information. Today’s users are increasingly looking for direct, concise answers to their queries, bypassing the traditional journey through blue links that Google has mastered. Instead of “5 blue links”, people would rather see a direct answer. This shift raises critical questions about the future role of search engines like Google in an era where immediacy trumps exploration. With AI-driven platforms such as ChatGPT gaining traction, the expectation for instant, accurate responses is becoming the norm, challenging Google’s primary revenue streams from search and YouTube. The company now stands at a crossroads, needing to adapt to this changing landscape where the value proposition of Search is being redefined. Being its primary revenue stream, comprising almost 100% of its operating revenue, the question of whether LLMs will negatively affect Google’s dominating presence in the search industry is one of great interest.

Reevaluating Google’s Foundational Values

The Gemini controversy has required Google to introspect on its corporate philosophy. Google’s ethos, rooted in values of equity and inclusion, has been a proclaimed pillar of its corporate culture. It was often said that, once you’re employed at Google, being fired is almost impossible (this appears to no longer be the case in recent years). Backlash over Gemini’s missteps reveals the increasing tension between advancing technology and maintaining a commitment to diversity and ethical considerations. Google’s challenge is to rectify the technical issues that led to Gemini’s biased outputs and to navigate the broader implications for its culture of innovation and inclusivity.

From an economic perspective

From an economic perspective, this rapid evolution in the way society seeks out and engages with information, as well as the process’s underlying values, represents a fundamental shift in how information itself is conveyed. Assuming peoples’ past methods of information retrieval will be partially replaced with LLMs, the advertising world will slowly start losing its primary vessel of communication—search engines and social media. It is also important to pose the question of whether these services will follow a subscription model or move toward a freemium ad-based framework. 

Furthermore, the current controversy with Google showcases a different socioeconomic trend: tech stocks are rising, fueled by the AI revolution on all sides of the spectrum, whether that is B2B or B2C. Meanwhile, people in the tech industry are gaining more power, and hence, more political capital. The difference this time, compared to previous tech surges, is that they are choosing to spend this political capital by expressing their (often unpopular) opinions on controversial subjects. Elon Musk’s tweets, for example, have been getting increasingly political. 


Overall, Google’s controversy with Gemini and its image generation is just the face value of a much larger issue spanning two key sectors: information retrieval and corporate ethics. In a world where the technological landscape is changing daily, and new, more powerful LLMs and neural networks are being created each week, it is difficult to predict the direction of these trends. Nevertheless, one thing is certain: this event was a wake-up call, not only for Google, Bing, and other search engines but for the whole tech industry and the fundamental building blocks that have supported its growth for all these years. 

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Disclaimer: The views published in this journal are those of the individual authors or speakers and do not necessarily reflect the position or policy of Berkeley Economic Review staff, the Undergraduate Economics Association, the UC Berkeley Economics Department and faculty, or the University of California, Berkeley in general.

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