CNBC AI Exclusive – May 26 – New data from StatCounter reveals Google’s search engine dominance dipped below the 90% threshold for the first time in Q4 2024, closing at 89.34%. While briefly rebounding to 90.15% in February 2025, March saw another decline to 89.71% – sustaining pressure on the tech giant to address evolving market dynamics.
Elon Musk, CEO of X and xAI, amplified industry speculation by commenting: “AI will render traditional search obsolete.” His assertion follows intensifying competition from AI-powered platforms like Perplexity and emerging chatbot integrations across rival ecosystems.
While AI-driven search solutions offer faster resolution for complex queries – such as comparative analysis or multi-step calculations – experts warn of reliability concerns. “Hallucination risks and source verification remain critical friction points,” said AI analyst Clara Winslow of TechInsight Group. “Trust architecture will determine winners in this space.”
Musk’s commentary arrived alongside internal challenges at X, where he admitted systemic vulnerabilities: “Our failover mechanisms failed when they should have activated.” The executive disclosed returning to crisis management mode, stating he’s “back to 24/7 shifts – sleeping near servers and production lines” ahead of pivotal launches for xAI, Tesla’s next-gen models, and SpaceX’s Starship program.
Industry analysts speculate the market shift reflects both AI adoption and regulatory pressures. “Google’s 25-year search monopoly is facing a perfect storm,” noted Bernstein’s tech strategist Mark Li. “While AI challengers aren’t yet profitable, their user experience innovations are rewriting the rules of information retrieval.”
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