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”Launching a startup airline comes with big challenges. Partnering with Search Machines was the best decision we made. Their expert team and ATLAS software helped us scale efficiently with multilingual ads reaching markets as far as Brazil and Canada. Thanks to their expertise, Arajet has experienced 40% growth in revenue year on year

Tania MancillaVP of Marketing, Arajet

So the AI hype has settled. Where are we now?

Search Machines · Phil Jensen · July 2026 · 4 min read

I am old enough to have switched from dial up modems to broadband, saw landlines switch to mobile, marveled at the first pages of the internet and watched it grow. 

Momentous shifts in tech. But nothing quite matches the drama of Nov 30th 2022. ChatGPT officially launches. I still remember the day. It felt seismic, and it was. 

It’s the end of the world

Initial responses ranged from “It’s the end of the world” to “It does not know how many Rs are in the word strawberry” (the last one was true!).

Predictions flew around about the death of search marketing, imminent AGI, mass unemployment, a nirvana where we sipped on pina coladas while AI and its robot helpers did everything for us. 

The froth has settled a bit and the whole field has matured and continued to rapidly evolve. So now the hype has settled where are we? 

Search is not dead but it is transformed 

One of the least successful predictions was that LLMs would replace search engines. Recent data has shown that research often starts on LLMs and then migrates to more traditional search platforms. Users appear to want to authenticate what they are seeing on LLMs for themselves. Google is alive and well. 

Search is being transformed though. Google’s recent re-imagining of the search box into a portal for accessing AI capabilities is the most fundamental change to search in the last 25 years. This change has just happened (announced at Google’s IO event in May). Time will tell what impact this has on the overall search landscape. 

AI is underhyped 

Sounds like an odd thing to say after I have said the hype has settled. 

In some ways the pace of change has not matched the initial hype. Particularly for businesses. But don’t mistake a slower pace for a lack of impact. Businesses have taken longer to adapt to AI but with the maturity of AI products we are now starting to see it deliver on those early promises. 

Fields as diverse as medicine, finance and software development are seeing transformative changes and we are only in the early stages of what that means. 

We expect more change is coming at a pace we have never seen before. Buckle up. 

The hallucinations are just a phase – AI will become more reliable! 

Plausibility is perhaps AI’s super power. Whether it is providing answers in chat, or generating new applications through vibe coding. AI can produce very compelling results.  

But are they reliable? Have the hallucinations stopped? I recently asked Google Ads AI advisor about a dip in performance in an account. It confidently told me it related to changes in Google’s bidding algorithm on June 1st. Unfortunately the changes it was referring to were announced on June 1st but will only be released on August 18th.  Plausible – absolutely. Reliable? Sometimes. 

As we embrace these new capabilities, we need mechanisms in place to ensure critical thinking and checking are maintained.

I asked Claude for an illustration – point proven…

As we embrace these new capabilities, we need mechanisms in place to ensure critical thinking and checking are maintained.

Everybody hasn’t lost their jobs – yet 

We have seen some tech companies lay off staff and cite AI as the reason – (although might it be a convenient excuse to deal with pandemic overhiring!). We have also seen some companies repent of their lay-offs and rehire experienced staff. Ford in particular learned a painful lesson. 

In the short to medium term AI augments what humans can do. The need for skilled staff has never been more important. Ford’s experience is an object lesson in why that is the case. 

Longer term?…There will be radical change, but the lesson from previous transformations like the industrial revolution is that jobs are both lost and created.

Some things changed way quicker than we expected – vibe coding anyone!? 

Few areas have been more impacted in the last few years than coding. Vibe coding is starting to make real world changes. I know people who would never describe themselves as techies who are producing innovative tech solutions that make a real world impact. This trend is only going to continue to grow.

Some unexpected challenges 

How do we develop people with the right skills when AI has automated foundational tasks that teach junior staff the basics? A recent survey showed this is a live question for the legal profession. It’s also a live question for us as we train the next generation of account managers. We are reworking all our onboarding training to help our junior staff develop the base skills they need. 

So where does that leave us?  

Not in the pina colada lounger of early predictions, but not in the apocalypse either. The reality is both more interesting and more demanding than those extremes. 

AI is a genuine force multiplier for people and businesses who engage with it thoughtfully. The ones who will thrive are those who combine the new capabilities with the critical thinking and human judgment that no model has yet replaced. That balance is harder to strike than it sounds, but it is absolutely worth pursuing. 

Ps. AI did not write this blog – although I was sorely tempted.
Pps. AI did make the illustrations – I never was that good at graphic design!

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