Google Focuses on Building AI Operating Layer to Compete with Microsoft
(Synopsis)

The recent Google I/O 2025 event in Silicon Valley highlighted the company’s growing emphasis on its AI initiatives, branded as Gemini, while unveiling several fast-paced innovations. More than just a hodge-podge of remarkable features, Google expressed a vision for a new operating system designed for the AI era, known as a “world model,” which would function as a universal assistant, comprehending and interacting with the real world.

This strategy aims to surpass other competitors and raises the question of whether Google can convert its AI research and technology into effective products more quickly than rivals like Microsoft and OpenAI, who have partnered to excel in delivering downloadable AI software solutions.

The processing capacity at Google has now reached 480 trillion tokens monthly, indicating a notable boost in developer participation and lower operational expenses. With the “AI Mode” being tested in the U.S., Google is fine-tuning performance while pursuing an AI-focused future. Nonetheless, a critical issue remains regarding how much control Google wants over its advanced assistant to sustain the profitability of its search business during a time of increased competition and regulatory oversight.

Discussions among Google leadership revealed a intent towards developing “world models” and an assistant that reflects more human cognitive skills. The CEO of Google DeepMind elaborated on this idea, mentioning plans to create AI that engages with the world similar to human thought processes. Recent Google demonstrations displayed cutting-edge applications such as the Flow filmmaking canvas and Gemini robotics, showcasing the practical outcomes of these endeavors.

Google’s approach targets both Microsoft’s dominance in the enterprise software market and the advances made by OpenAI, especially as competition heats up with Amazon’s anticipated AI developments. As Google executives navigate the complexities of this changing AI landscape, the necessity for an effective AI-native interactive operating system has become clear. Google’s direction at I/O 2025 reflects a commitment to redefine the future of AI. But, success will depend on delivery and the ability to integrate its diverse technological research into a seamless, practical user experience while addressing various external challenges, including regulatory issues, before the entire AI market shifts to favor one of its competitors.