Chegg - Business Outrank

Google is being sued by US-based edtech firm Chegg, accusing it of using its new AI search feature, AI Overviews for harming traffic and thus, undermining content publishers. Chegg claims that Google’s AI-generated summaries are keeping users from visiting the original sources, which is detrimental to Chegg’s business model that heavily depends on students’ interaction in the form of textbook rentals, homework help, and tutoring services. Chegg has filed a lawsuit in Washington claiming that Google is using publishers’ content to keep users on its platform and, in effect, blocking the financial incentive for creating original content. It warns that such practices could result in the emergence of the ‘hollowed-out information ecosystem of little use and unworthy of trust.’ Chegg has recently noticed a decline in site visitors and subscribers and has even considered a sale or a take-private transaction, according to its CEO, Nathan Schultz. However, Google has called Chegg’s arguments shallow and irrelevant. Jose Castaneda, a spokesperson, said, “With AI Overviews, people find Search more helpful and use it more, creating new opportunities for content to be discovered. Every day, Google sends billions of clicks to sites across the web, and AI Overviews send traffic to a greater diversity of sites.” Despite Google’s defence, Chegg has stated that the lawsuit is not only relevant to the two companies but highlights issues that are important for the entire digital publishing industry. In response, Schultz said that Google’s AI tools are ruining the quality of step-by-step learning for students by popping up unverified summaries instead. He also accused Google of forcing publishers to accept the use of their content for AI or, in effect, coercing them into violating laws against tying the sale of unrelated products. This lawsuit is the second of its kind against Google, the first having been filed by an Arkansas newspaper and now before US District Judge Amit Mehta.

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