Google's AI Previews Erode the Internet, Edtech Company Says In Lawsuit

Chegg has filed a lawsuit against Google, accusing the tech giant of using AI-generated overviews to undermine publishers by reducing site traffic and eroding financial incentives for original content. Chegg claims this practice violates antitrust laws and threatens the integrity of the online information ecosystem. Reuters reports: This will eventually lead to a 'hollowed-out information ecosystem of little use and unworthy of trust,' the company said. The Santa Clara, California-based company has said Google's AI overviews have caused a drop in visitors and subscribers. Chegg was trading at around $1.63 on Monday, down more than 98% from its peak price in 2021.

The company announced it would lay off 21% of its staff in November. Nathan Schultz, CEO of Chegg, said on Monday that Google is profiting off the company's content for free. 'Our lawsuit is about more than Chegg -- it's about the digital publishing industry, the future of internet search, and about students losing access to quality, step-by-step learning in favor of low-quality, unverified AI summaries,' he said.

Publishers allow Google to crawl their websites to generate search results, which Google monetizes through advertising. In exchange, the publishers receive search traffic to their sites when users click on the results, Chegg said. But Google has started coercing publishers to let it use the information for AI overviews and other features that result in fewer site visitors, the company said. Chegg argued the conduct violates a law against conditioning the sale of one product on the customer selling or giving its supplier another product.

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