Online education company Chegg filed a lawsuit against Google in federal district court, claiming that AI-generated summaries of search giant search results destroyed Chegg's web traffic and revenue. Worse, Chegg claims that Google is using its vast database of educational materials to train AIs killing current traffic and revenue performance.
CNBC Report On Monday, Chegg, a well-known online education platform, took legal action against Google by filing a lawsuit in federal district court. The complaint argues that Google's AI overview, which provides an artificial intelligence-generated summary of search results, has done a great deal of harm to Chegg's web traffic and revenue.
Nathan Schultz, president and CEO of Chegg, has forced Google's exclusive company to include its own content in search results, with search giants not investing in the content creation process and economic benefits claims to enjoy. Despite the lawsuit, Chegg has its own AI strategy, leveraging Meta's open source model and the models of humanity and Mistral. The company also has a partnership with Openai, which it considers as a competitor alongside Google.
Google's AI overview is available in over 100 countries, used by over 1 billion users, and appears above links to other pages in search results. Chegg claimed that Google trained AI models using a collection of 135 million questions and answers in a variety of subjects. The complaint included a screenshot of Google AI overview of borrowing information from Chegg's website without proper attribution, but related Chegg pages are shown low in search results.
Chegg's lawsuit has cited the federal judge's ruling since August 2020, finding Google has held its monopoly in the search market. The decision follows a groundbreaking lawsuit filed by the Department of Justice, which claims that Google has maintained its dominance in the general search market by creating a strong barrier to entry and an independent feedback loop. Masu.
In the fourth quarter, Chegg reported a net loss of $6.1 million with revenue of $143.5 million, representing a 24% decline from the previous year. The company's management provided guidance in the first quarter, forecasting revenues of between $114 million and $116 million, and did not meet analysts' $138.1 million expectations. Following the announcement, Chegg shares experienced a 24% decline in expanded trading.
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Lucas Nolan is a reporter for Breitbart News, which covers the issues of freedom of speech and online censorship.
