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This scenario brings up the classic “innovator's dilemma”—where established companies must navigate the risks of disruptive innovation without undermining what made them successful in the first place. As regulatory pressures mount and questions linger regarding Google's valuation, the effectiveness of this new approach remains in question.
Google’s Competitive Edge
One aspect that might be overlooked by investors is Google’s inherent advantages in AI pricing and deployment efficiency. Google has developed extensive infrastructure to support AI at multiple levels, from foundational models to user-facing services. The breadth of its reach, with billions of users accessing Google’s products, presents a substantial distribution advantage that competitors may find difficult to match.