Chegg just sued Google. The reason? AI-generated summaries in search results are eating into its website trafficโand revenue. But hereโs where it gets more interesting... Chegg has relied on Googleโs search engine for years to drive traffic and revenue. Now, Googleโs AI summarizes answers directly in search, meaning fewer people are clicking through to Cheggโs site. And the impact? Brutal. ๐ Chegg's stock is now worth just over $1 per share. ๐ Revenue fell 24% year over year. ๐ Subscriptions dropped 21% in Q4. In response, Chegg is considering big movesโfrom acquisitions to going private. ๐น But hereโs the twist: Chegg isnโt against AI. Theyโve partnered with OpenAI, used Metaโs Llama, and integrated models from Anthropic & Mistral into their platform. So, why the lawsuit? Chegg argues that Google is using its content to train AI modelsโthen serving competing answers without attribution. Google, on the other hand, insists its AI Overviews improve search for over 1 billion users in 100+ countries. ๐ The bigger picture? AI is redefining search. Companies built on SEO-driven traffic are now facing an existential threat. Will Cheggโs lawsuit change anything? Or is this just the beginning of AI disrupting search-based businesses?
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