The AI wars have already cost Google $143b. It’s in panic mode

Google’s blog entry and Tweets about Bard contained an animated graphic (reproduced above,) showing Bard in action. It was asked: “What new discoveries from the James Webb Space Telescope can I tell my 9-year-old about?” and it responded with information that was called out (by boring old human experts) as being wrong.

Apparently the James Webb Space Telescope was not responsible for the “very first pictures” of an exoplanet outside our solar system.

This kind of embarrassment is exactly why Google was previously said to have kept its own generative AI chatbot (based on its LaMDA technology) under wraps.

It isn’t yet trustworthy enough to be let out into the wild, but the commercial stakes have changed due to Microsoft’s part ownership of ChatGPT maker OpenAI and its progress in integrating it into its products.

Earlier this week, Microsoft announced ChatGPT is being added into web search results on its Bing service, which until now, has languished as the most used also-ran behind Google’s all-conquering web search.

While Microsoft’s shares have risen in anticipation that it could finally be cracking Google’s dominance in search (as well as improving its Azure cloud products) Google’s backers punished it on Thursday for handing in its homework unfinished.

Whereas ChatGPT has been forgiven its tendency to “hallucinate”, or its mastery of the “unique human skill of bullshitting”, due to its novelty, all the talk had been that Google’s imminent arrival on the scene would be demonstrably superior.

It wasn’t, and its shares plunged 8 per cent, which is the equivalent to more than $US100 billion ($143 billion) off its staggering trillion-dollar plus market cap.

Google’s leaders will be hoping this is just a blip, and that its long-held position as the front page of the internet, will see it swat Microsoft aside.

“We’ll continue to use feedback from internal and external testing to make sure it meets the high bar for quality, safety, and groundedness, before we launch it more broadly,” Raghavan said in Paris.

His presentation did give a good view of just how Bard will look as a part of the traditional web search experience. Operating as a conversational introduction, before the user can choose to scroll down and use traditional web link-based results.

Google will be desperate to keep users within this familiar format, where it can serve up its mix of sponsored and organic results, where it still makes the lion’s share of its revenue.

“As we scale these new generative AI features like this in our search results, we continue to prioritise approaches that will allow us to send valuable traffic to a wide range of creators and support a healthy open web,” Raghavan said.

Microsoft has undoubtedly won this first skirmish of the AI wars, putting Google in the unusual position of looking like Johnny-come-lately, but there is a long way to go yet.

Google’s search has become so ingrained in daily life for many that it will be a hard habit to shake, and its ownership of the Android operating system that powers most of the world’s phones, means it is likely to put Bard in most people’s hands as a default option.

Just don’t trust either Bard or ChatGPT to get its facts right yet.