6/22: Google Stumbles - by Theo Jaffee - MTS

6/22: Google Stumbles

Plus: Google x A24 partnership, Anthropic x Micron partnership, quantum executive order

Theo Jaffee

Jun 22, 2026

Welcome back, monitors. I hope you enjoyed the three-day weekend, because we’re back in the Situation Room all week. Be sure to catch us on X and YouTube, and join our Discord to chat with our hosts live.

Today’s Experts

Making Sense of the World

Google Stumbles

Last week, Noam Shazeer — co-inventor of the Transformer, mixture of experts, and LaMDA; founder of Character AI; and co-lead of Gemini — left Google for OpenAI. On Friday, John Jumper — one of the creators of AlphaFold, for which he won a Nobel Prize — left Google for Anthropic. Both of these are heavy blows to the company. As one frontier lab researcher told me this weekend, there are maybe 50 people in the world who truly understand how to train a frontier model end-to-end. If AI is the most important thing in the world, it stands to reason that these people are among the most economically valuable workers on earth, and it’s a top priority for companies to attract and retain them 1. The markets know this, and Google stock fell 5% today, wiping out a couple hundred billion dollars of market value.

More broadly, Google has been struggling for some time. Gemini 3.5 Flash, released a month ago, is roughly on the level of GPT-5.2, released in December, and substantially behind Fable, Opus 4.8, and GPT-5.5. Gemini 3.5 Pro is nowhere to be found. If you zoom out even further, Google’s fumble becomes even more apparent. In the mid-2010s, Google had two frontier labs (DeepMind and Google Brain), tremendous compute/data/cash flow/talent advantages, and a near-monopoly on the frontier tech. Google was so dominant that Elon Musk was personally inspired to co-found OpenAI because he feared Google would dominate the entire future if he didn’t found a competitor. The Transformer was invented not inside of OpenAI, but Google — but OpenAI, not Google, was the first to successfully commercialize it, and Google struggled to bring their own LLM to market for a while. It’s entirely possible that the phenomenon of Google as a frontier AI lab was only really true from ~2010 to 2018 and through most of 2025.

Then again, leads in AI change constantly. The “Mandate of Heaven” meme on X rarely reflects reality, and labs that seem totally invincible, like OpenAI in 2023, can lose their lead just as easily. Maybe Google will figure out their issues, leverage their compute and data advantages, and catch up to OpenAI and Anthropic again. Maybe they’ll shift their niche from building frontier models themselves to supplying TPUs and Google Cloud capacity for others to do so. Or maybe, like Meta, their small errors will compound, and they’ll find themselves far behind companies that once had a fraction of their resources. Whatever happens, we’ll be monitoring.