Google CEO Sundar Pichai on the Launch That Made the Company Issue
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How ChatGPT’s debut shook Google’s AI dominance and triggered an internal overhaul
Mountain View, October 17, 2025 – Friday
When OpenAI first launched ChatGPT in late 2022, it sparked what insiders later described as a “code red” alert across Google. According to Sundar Pichai, the surge in AI capability and attention forced Google to rapidly reassess its AI roadmap, redirect resources, and re-energize its competitive edge.
The Moment That Destabilized the AI Order
For years, Google held the mantle of AI leadership, leveraging deep research, scale infrastructure, and ambitious projects. Yet the release of ChatGPT, backed by Microsoft and instantly adopted by millions, signaled a sudden shift in momentum.
Pichai later said that OpenAI deserved credit for getting its chatbot to market first—a rare acknowledgment from the head of Google. He described the moment as one when Google’s internal radar went off, prompting urgency in mission alignment.
He noted that Google already had internal chatbot prototypes, but believed they were not mature enough for public release. The reputational risks of deploying an imperfect AI weighed heavily.
The Internal “Code Red” and Strategic Reset
The “code red” measure, as reported by various media, entailed redirecting teams, reprioritizing AI projects, and enlisting high-level oversight. Founders and senior executives, some semi-retired, were pulled into the shift to stabilize direction.
Pichai later clarified that he never literally declared a formal “code red,” but admitted he pushed urgency and reallocated attention amid the disruption. He said many in the company believed the “code red” label themselves.
Team leaders were asked to intensify focus on large language models, reasoning systems, and generative tools—projects that had been incubating but now became top priority.
Riding the Shift: From Bard to Gemini
In March 2023, Google publicly launched its chatbot, initially named Bard, later rebranded as Gemini. The product debut was a bet that Google could catch up and compete, but it also carried the burden of expectations and comparisons to ChatGPT.
Pichai admitted that in hindsight, Google might have moved faster—but insisted the constraints were real: reliability, trust, and the risk of deploying a flawed model.He emphasized that Google’s posture was always more cautious because of its scale and responsibility to users.
As Google pivots, Gemini remains under active improvement. In early 2024, Pichai called certain responses “unacceptable” in internal communications, flagging bias and errors for urgent fixes.
Impact and Reflections on Google’s AI Positioning
The “code red” episode is now viewed as a turning point. It crystallized internal priorities, broke silos, and catalyzed faster AI development across Google’s product stack.
But it also exposed vulnerabilities: platforms built on incumbency can be blindsided by nimble challengers. The lesson: innovation cycles compress quickly, and leadership must stay agile.
Pichai has since said the ChatGPT moment excited him because he saw a shift in the AI opportunity window. It wasn’t fear, but a signal to lean harder into generative AI.
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