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Alphabet CEO Sundar Pichai gestures during a session at the World Economic Forum (WEF) annual meeting in Davos, on January 22, 2020.

Fabrice COFFRINI | AFP | Getty Images

Google CEO Sundar Pichai told employees last week that “the stakes are high” for 2025, as the company faces increased competition and regulatory hurdles and contends with rapid advancements in artificial intelligence.

At a 2025 strategy meeting on Dec. 18, Pichai and other Google leaders, donning ugly holiday sweaters, hyped up the coming year, most notably as it pertains to what’s coming in AI, according to audio obtained by CNBC.

“I think 2025 will be critical,” Pichai said. “I think it’s really important we internalize the urgency of this moment, and need to move faster as a company. The stakes are high. These are disruptive moments. In 2025, we need to be relentlessly focused on unlocking the benefits of this technology and solve real user problems.”

Some employees attended the meeting in person at Google’s headquarters in Mountain View, California, and others tuned in virtually.

Pichai’s comments come after a year packed with some of the most intense pressure Google has experienced since going public two decades ago. While areas like search ads and cloud produced strong revenue growth, competition picked up in Google’s core markets, and the company faced internal challenges including culture clashes and concerns about Pichai’s vision for the future.

Additionally, regulation is now heavier than ever.

In August, a federal judge ruled that Google illegally holds a monopoly in the search market. The Justice Department in November asked that Google be forced to divest its Chrome internet browser unit. In a separate case, the DOJ accused the company of illegally dominating online ad technology. That trial closed in September and awaits a judge ruling.

That same month, Britain’s competition watchdog issued a statement of objections over Google’s ad tech practices, which the regulator provisionally found are impacting competition in the U.K.

“It’s not lost on me that we are facing scrutiny across the world,” Pichai said. “It comes with our size and success. It’s part of a broader trend where tech is now impacting society at scale. So more than ever, through this moment, we have to make sure we don’t get distracted.”

A Google spokesperson declined to comment.

Google unveils Gemini 2.0 AI models

Google’s search business still has dominant market share, but generative AI has served up all sorts of new ways for people to access online information, and has brought with it a host of new competitors.

OpenAI’s ChatGPT kicked off the hype cycle in late 2022, and investors including Microsoft have since propelled the company to a $157 billion valuation. In July, OpenAI announced it would launch a search engine of its own. Perplexity is also promoting its AI-powered search service and recently closed a $500 million funding round at a $9 billion valuation.

Google is investing heavily to try and stay on top, principally through Gemini, its AI model. The Gemini app gives users access to a number of tools, including Google’s chatbot.

Pichai said “building big, new business” is a top priority. That includes the Gemini app, which executives said they see as Google’s next app to reach half a billion users. The company currently has 15 apps that have hit that mark.

“With the Gemini app, there is strong momentum, particularly over the last few months,” Pichai said. “But we have some work to do in 2025 to close the gap and establish a leadership position there as well.”

“Scaling Gemini on the consumer side will be our biggest focus next year,” Pichai later added.

‘Don’t always have to be first’

At the meeting, Pichai showed a chart of large language models, with Gemini 1.5 leading OpenAI’s GPT and other competitors.

“I expect some back and forth” in 2025, Pichai said. “I think we’ll be state of the art.”

He acknowledged that Google has had to play catchup.

“In history, you don’t always need to be first but you have to execute well and really be the best in class as a product,” he said. “I think that’s what 2025 is all about.”

Executives took questions that were submitted by employees through Google’s internal system. One comment read aloud by Pichai suggested that ChatGPT “is becoming synonymous to AI the same way Google is to search,” with the questioner asking, “What’s our plan to combat this in the upcoming year? Or are we not focusing as much on consumer facing LLM?”

For the answer, Pichai turned to DeepMind co-founder Demis Hassabis, who said that teams are going to “turbo charge” the Gemini app and that the company has seen progress in the number of users since launching the app in February. He said “the products themselves are going to evolve massively over the next year or two.”

Hassabis described a vision for a universal assistant that “can seamlessly operate over any domain, any modality or any device.”

Google's fate hinges on this man: Demis Hassabis

Project Astra, Google’s experimental version of a universal assistant that the company announced in May, will be updated in the first half of the year.

Another employee question asked whether Google will be able to get AI products to scale without charging $200 a month “like other companies.”

“Right now, we don’t have any plans for this kind of subscription level,” Hassabis responded, adding that he thinks the $20 monthly charge for Gemini advanced is a good value. “I wouldn’t necessarily say never but there are no plans for that at the moment.”

Toward the end of the meeting, Google welcomed to the stage Josh Woodward, the head of Google Labs. He took the microphone as the Zombie Nation song “Kernkraft 400” played loudly in the background.

“I’m going to try to do six demos in eight minutes,” said Woodward, who’s known for his high level of energy.

Woodward started by showing off Jules, a coding assistant that’s in a trusted tester’s program. He said, “It’s where the future of software development is headed.”

Woodward then shifted to AI notetaking product NotebookLM, which featured a series of updates in 2024, including a podcasting tool. Woodward demonstrated how the company is trying a new feature that allows the user to “call in” to a podcast. 

He then moved onto Project Mariner, an AI-powered multi-tasking Chrome extension. Woodward asked it to add the top restaurants from Tripadvisor to the Maps app. After a brief pause, the demo successfully worked, leading employees in attendance to erupt in applause.

Throughout the meeting, Pichai kept reminding employees of the need to “stay scrappy.” Google has gone through an extensive phase of cost cutting that included eliminating about 6% of its workforce in 2023 and a continued focus on efficiency.

As of the end of the third quarter, Alphabet had 181,269 employees, down about 5% from the end of 2022.

At one point, Pichai referenced Google founders Larry Page and Sergey Brin, who started the company 26 years ago, long before cloud computing or AI tools existed.

“In early Google days, you look at how the founders built our data centers, they were really really scrappy in every decision they made,” Pichai said. “Often, constraints lead to creativity. Not all problems are always solved by headcount.”

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TikTok creators, partners remain optimistic ahead of app’s second ban deadline

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TikTok creators, partners remain optimistic ahead of app’s second ban deadline

Photo illustration shows the TikTok logo displayed on a mobile phone screen.

Sopa Images | Lightrocket | Getty Images

For the second time this year, TikTok is staring at a deadline that could determine its fate in the U.S. and that of numerous creators and brands that have built businesses on the Chinese-owned social app.

The sense of urgency that led some creators to post wistful goodbye videos in January has shifted to a more cautiously optimistic outlook, with creators and firms saying they believe TikTok will remain in the U.S. They are, however, hedging their bets. 

“I’m trying to be optimistic and hope that they keep it, but as a creator, I have to be prepared either way,” said Gianna Christine, a creator with 2.7 million TikTok followers. 

TikTok could be effectively banned in the U.S. on April 5 because of a national security law originally signed by former President Joe Biden that requires its Chinese parent ByteDance to divest the app’s American operations. ByteDance originally faced a Jan. 19 deadline to sell TikTok, but Trump signed an executive order instructing the attorney general to not enforce the law, granting the Chinese company 75 more days to divest the U.S. portion of its business.

Gianna Christine makes lifestyle videos about living in New York City to her nearly 3 million followers on TikTok.

Gianna Christine

Like others who spoke with CNBC, Christine said she hasn’t received any direct updates from TikTok about its future. Christine said she’s staying positive about TikTok’s chances of remaining in the U.S. but she’s also expanding her presence on platforms like Snapchat and YouTube as a precaution.

“You never know what will happen,” Christine said.

Throughout his 2024 presidential campaign, Trump said many positive comments about TikTok and used the app as a campaign tool. Trump said Sunday that he is “pretty certain” that a TikTok deal will be reached before the April deadline, according to AFP. Last week, Trump said he may extend the deadline if a deal isn’t reached and that he may reduce tariffs on China to help facilitate a transaction.

“I really don’t see TikTok getting banned,” said Olivia Plotnick, the founder of the Wai Social marketing and consultancy agency. “Trump really is going to want to show how amazing he is, and make a deal happen.”

TikTok and the White House did not respond to requests for comment.

Whatever is in store for TikTok, the company is acting like business as usual.

Current and former TikTok workers said they have received no communication from management about its future in the U.S. Brands and creators said they have received no updates from the company either.

That lack of communication and the uncertainty of the app’s future hasn’t stopped TikTok from moving forward with new partnerships. 

Marketing firm Meltwater, for example, announced that it joined TikTok’s marketing partners program in March. Aditya Jami, Meltwater’s tech chief, said that his TikTok contacts seemed to be “in the dark” about the app’s future, but they went ahead with the partnership, which will require deep integration between the two companies.

 “They are actually going to do more and more things that we can build together and then expose to our customers, so I feel like it’s going business as usual,” Jami said.

TikTok creator Alyssa McKay has more than 10 million followers, but she’s been proactive about diversifying her following across more platforms.

“If you’re not already posting on Snapchat, Instagram Reels, YouTube Shorts, that’s where you need to be,” said McKay, adding that her efforts to get ahead of a potential ban have resulted in her already earning more revenue from other platforms than she does on TikTok.

Alyssa McKay is a content creator with over 10 million followers on TikTok.

Alyssa McKay

The first TikTok ban deadline didn’t significantly alter the social media postings from creators and brands, according to data provided to CNBC by Later, a social media and influencer marketing firm.

Social media users increased their posts on Threads and YouTube by 10% and 6%, respectively, the week of the TikTok ban in January compared to the week prior, according to Later. Still, the general posting habits of brands and creators during the week after the January deadline compared to the week preceding it were nearly identical, a spokesperson for Later said. 

Throughout March, creators and brands steadily reduced the number of scheduled TikTok posts they plan to publish during the weeks leading up to the April deadline while increasing their scheduled Instagram posts, Later data showed. The March data suggests creators and brands are “reallocating content to Instagram as a safer or more stable alternative,” the Later spokesperson said.

For a brief moment, the Chinese social media app RedNote rose to the top of Apple’s app store during the week leading to the January deadline. Known as Xiaohongshu in China, that app has similar short-video features as TikTok, but it has a user base comprised mostly of women from more affluent Chinese cities that embraced the sudden influx of American users, Plotnick of Wai Social said.

“They were super welcoming, and it was a really fun time,” Plotnick said.

RedNote’s moment in the sun won’t likely repeat. The app is no longer a priority now that TikTok has resumed normal operations, creators and brands said. 

“I don’t foresee buzz around alternative apps like RedNote,” Later CEO Scott Sutton said. “Those were a blip and lacked the staying power of other platforms.”

It’s unclear whether lawmakers who are concerned about the Chinese Communist Party  or TikTok-competitors like Meta or Google would take to the courts to enforce the national security law, said Neil Chilson, a former chief technologist at the Federal Trade Commission who now heads AI policy at Abundance Institute non-profit. Taking that kind of legal action carries the risk of upsetting TikTok’s giant user base and Trump, Chilson said.

“Trump likes this sort of leverage that the law provides him,” Chilson said. “He’s obviously using quite aggressively — not quite in the text of the law — his latitude to make deals to continue to string this along.”

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Amazon resumes drone deliveries after two-month pause

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Amazon resumes drone deliveries after two-month pause

Amazon has restarted drone deliveries in two states after a months-long pause, the company confirmed.

In January, Amazon halted Prime Air deliveries in College Station, Texas, and Tolleson, Arizona, the two U.S. markets where it’s testing the service, as the company rolled out a software update to its drone fleet.

Amazon discovered an abnormality with the drone’s altitude sensor, caused by dust in the air, that could have caused its system to produce an inaccurate reading of its position relative to the ground, the company said. Amazon “never experienced an actual safety issue,” but said it opted to suspend deliveries while it corrected the issue.

The company brought drone deliveries back online last week after it completed the software update and received approval from the Federal Aviation Administration, Amazon spokesperson Av Zammit said in a statement.

“Safety underscores everything we do at Prime Air, which is why we paused our operations to conduct a software update on the MK30 drone,” Zammit said. “The updates are now complete and were approved by the FAA, allowing us to resume deliveries.”

An FAA spokesperson didn’t immediately provide a comment.

Zammit said Prime Air has seen “unprecedented levels of demand” since it resumed service. David Carbon, an executive who oversees Amazon’s drone program, wrote in a LinkedIn post last week that the company dropped a bottle of ZzzQuil sleep medicine at an Arizona customer’s home in “31 minutes and 30 seconds.” Carbon didn’t say how far the drone had to fly and Zammit declined to provide details.

For over a decade, Amazon has been working to bring to life founder Jeff Bezos’ vision of drones whizzing toothpaste, books and batteries to customers’ doorsteps in 30 minutes or less. But progress has been slow, as Prime Air has only been made available in the U.S. in College Station and Tolleson. A test site in Lockeford, California, was shuttered last April. The program was also hit with layoffs in 2023 as Amazon CEO Andy Jassy cut costs across the company.

Amazon has set a goal to deliver 500 million packages by drone per year by the end of the decade. The company last year notched a critical regulatory milestone that could enable it to accelerate deliveries. It’s eyed international expansion to the U.K., and recently welcomed Transportation Secretary Sean Duffy in a visit to a Prime Air facility.

The company also introduced a new version of its delivery drone, called the MK30, which is designed to be quieter than previous models and can fly in light rain.

Customers in College Station, a quiet suburban town that’s about 100 miles northwest of Houston, had previously complained about the drones’ noise levels. After rolling out the MK30, the company is also taking steps to relocate its drone hub farther away from residents’ homes later this year.

Before Amazon suspended drone deliveries, the MK30 crashed in two separate incidents during test flights at the company’s facility in Pendleton, Oregon. Last December, a software issue caused two drones to crash, according to Bloomberg. And in September, a pilot mistakenly caused a “mid-air collision” between two drones after he tested how the MK30 would perform when faced with a failed propeller, according to a federal crash report.

Another crash occurred on Feb. 21 during tests at the Pendleton site, which resulted in a drone sustaining substantial damage, according to a report compiled by the National Transportation Safety Board.

Amazon said the crashes were unrelated to its decision to halt drone operations. The company has said these kinds of incidents, which have also occurred with other models in previous years, are part of the testing process, as it pushes drone systems “up to the limits and beyond.”

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Trump’s tariffs could mean big business for supply chain software startup LightSource

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Trump's tariffs could mean big business for supply chain software startup LightSource

LightSource cofounders: CTO Idan Mintz and CEO Spencer Penn

Courtesy: LightSource

With President Donald Trump set to impose sweeping tariffs on a wide swath of U.S. trading partners this week, corporate America is awash in uncertainty.

LightSource, a San Francisco startup whose software helps companies manage their procurement process, costs and vendor relationships, didn’t know what the president’s tariffs plan would look like before raising its first funding round. But the timing didn’t hurt.

LightSource has just closed a $33 million financing, led by Bain Capital Ventures and Lightspeed Venture Partners, with participation from J2 Ventures.

“Tariffs and trade winds are shifting so fast, it’s enough to make your head spin,” said Ajay Agrawal, a partner at Bain and now a board member at LightSource. “For a company with hundreds or thousands of different parts and suppliers — even just understanding what the impact will be on their whole enterprise is unbelievable.”

President Trump’s plans to slap “reciprocal tariffs” on all countries with duties on U.S. goods is set to be announced on Wednesday. Concerns surrounding the impact of those moves pushed the Nasdaq down more than 10% in the first quarter, the index’s biggest drop for any period since 2022.

Trump has already said he would impose 25% tariffs on “all cars that are not made in the United States.” Autos is a market that co-founder and CEO Spencer Penn knows well.

LightSource was started in 2021 by Penn and CTO Idan Mintz, while the two were working in different parts of Alphabet. Penn was at robotaxi unit Waymo, and Mintz was in the Google X “moonshot factory.”

Prior to Waymo, Penn worked at Tesla when the electric vehicle maker was starting to mass produce its popular Model 3 sedans. He said that finance, sourcing and engineering professionals have to work together to find, or sometimes custom order, high-quality parts. They also have to maintain their best supplier relationships while evaluating new potential vendors and negotiating fair prices.

Often these teams rely on “hundreds of disparate processes and information that’s stuck in thousands of emails, spreadsheets and randomly formatted invoices and contracts,” Penn said.

LightSource, which has about 30 employees, connects a company’s procurement-related information sources and systems to streamline that complex work. The aim is to speed up a company’s procurement process, saving the business time, money and pain while working with suppliers.

Mintz describes LightSource’s offering as a kind of “operating system” for procurement. Penn says it has the potential to do for procurement what Salesforce did for customer relationships.

Whether it’s a global pandemic, a natural disaster cutting off a shipping route, or a major shift in tariffs and trade policy, Mintz said, any supply chain disruption can make a huge difference to a company’s profit margins and its ability to deliver a product on time.

Current customers include consumer packaged goods companies, aerospace ventures, e-commerce companies and automotive giants.

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