Alphabet Inc, the parent company of Google, suffered a massive blow as its market value dropped by $100 billion following the debut of its new chatbot, Bard, which delivered inaccurate information in a promotional video. This blunder fueled concerns that Google is losing its edge to rival Microsoft Corp. Shares of Alphabet slipped as much as 9% during regular trading with volumes almost three times the average, however, they recovered somewhat in after-hours trading.
The error was first reported by Reuters and involved Bard’s response to the prompt “What new discoveries from the James Webb Space Telescope (JWST) can I tell my 9-year-old about?” Bard responded with incorrect information, suggesting that the JWST was used to capture the first images of an exoplanet, when in fact the European Southern Observatory’s Very Large Telescope (VLT) captured the first such images in 2004.
Google’s live-streamed presentation, which was held in an effort to showcase Bard’s capabilities, failed to impress and lacked details on the integration of Bard into Google’s core search function. Meanwhile, Microsoft held a successful event the previous day, showcasing its newly released Bing search integrated with ChatGPT functions.
The increasing competition in the AI sector has been a source of excitement for technology firms after recent job cuts and pledges to scale back on ambitious projects. The appeal of AI-driven search lies in its ability to provide results in plain language, making browsing faster and more efficient. However, there are also risks associated with chatbot AI systems, such as biases in algorithms that can skew results, sexualize images, or plagiarize. Microsoft has experienced this in the past, with its Twitter chatbot from 2016 that generated racist content before being shut down.
Google has been on the back foot since OpenAI, a startup backed by Microsoft with $10 billion, introduced its AI software in November, which has received widespread praise for its accurate and well-written responses. Alphabet has brought in its founders, Sergey Brin and Larry Page, to help speed up its efforts and keep pace with OpenAI and its rivals.
“I think still Bing is a far, far cry away from Google’s search capabilities,” said King Lip, chief strategist at Baker Avenue Wealth Management, which owns shares of both Alphabet and Microsoft. However, he added that the concerns about Alphabet may be overblown. The impact of AI on targeted advertising remains unclear, but it has the potential to transform the backbone of search engines like Google.
Overall, the AI battle between Google and Microsoft continues to be a topic of interest in the tech industry, with each company striving to outdo the other in the race to be the leader in AI innovation.
Blogteq will continue to closely follow the ongoing AI battle between Google and Microsoft, providing updates and in-depth analysis on the latest developments.
