Why has Google’s new AI chatbot caused the company’s stock to fall?
Alphabet, Google’s parent company, sees stock fall after failure to keep up with its competition on AI.
Alphabet, Google’s parent company, has seen its stock price fall by over seven percent this week.
A set of factors help explain the decline in the stock’s performance, one of which relates to the AI chatbot, ChatGPT. This new chatbot, was integrated into the search engine, Bing.
Owned by Microsoft, Bing, sees the addition of ChatGPT as the key to increasing their market share of online search. ChatGPT can do much more than send simple messages. Many on social media have shared their experiences with ChatGPT, asking it to write speeches, poems, and essays about politics, celebrities, and much more... in seconds.
Google tries to keep up
To compete with Microsoft’s new development, Google announced a similar AI, Bard.
Bard is an experimental conversational AI service, powered by LaMDA. Built using our large language models and drawing on information from the web, it’s a launchpad for curiosity and can help simplify complex topics → https://t.co/fSp531xKy3 pic.twitter.com/JecHXVmt8l
— Google (@Google) February 6, 2023
Unfortunately for the search giant, issues began to arise soon after Bard’s preview at the Google event in Paris. When the presenter asked Bard “What new discoveries from the James Webb Space Telescope (JWST) can I tell my 9-year-old about?” The AI responded with the incorrect suggestion that the telescope had taken “the very first pictures of a planet outside of our own solar system.”
Google’s Bard AI chatbot gives wrong answer at launch event.
— Barsee 🐶 (@heyBarsee) February 9, 2023
It wiped $120bn off Google’s valuation.
Meanwhile Microsoft CEO @satyanadella pic.twitter.com/Op1qz6sRLx
The fact that programmers had not checked what Bard would produce given when given the samples raised many doubts and shook the confidence of Google’s investors. As the news spread, Alphabet’s value began to fall. Since the presentation on Wednesday the stock has lost $100 billion.
This news has sent shock waves through the tech industry. AI expert Jim Fan, and others, were setting up the release of Bard as a direct challenge to ChatGPT as a “dance of giants.”
ChatGPT reached 100M users in 2 months, and is expanding at an increasing speed.
— Jim Fan (@DrJimFan) February 7, 2023
Google Bard, if fully rolled out, will reach at least 1B users.
We are witnessing 2 largest deployments of big neural nets in history. A dance of giants. Unfolding in real time.
Drawn to scale 👇 pic.twitter.com/2wDrfLj8zL
Where does Google go from here?
Currently, Google dominates online search. But, the failure of Google to keep up with competitors on AI was a reminder that just because the search engine has dominated doesn’t mean it always will. Some investors now worry that their share of the market could fall as competitors better integrate AI into their search engines.