AI war heats up between Google and Microsoft

The AI war in the Net world seems to have already broken out, with Microsoft incorporating ChatGPT of OpenAI, in its search engine Bing, which has always remained in the shadow of the more successful and widespread Google, seems to be posing a real danger to its arch-rival Google. This had become apparent with Google’s chatbot, Bard, failing to make its mark in its market debut with some clumsy and inaccurate responses to questions and demands by potential users. This was accompanied by the fact that Google’s ad revenues fell by eight per cent on Wednesday and wiped off $100 billion of shareholders’ wealth, which had nothing to do with the emergence of ChatGPT in November. There has been a general slackness in the economy, and all the big tech companies, including Microsoft, Google, Amazon had laid off workers in the face of a looming recession. But Microsoft deploying ChatGPT in Bing rang alarm bells in Alphabet, the parent company of Google.

Google has been working on an AI device for six years and more but it has not been able to make a breakthrough with something as attractive as ChatGPT, which is now being used by millions since its launch last November. An industry analyst, Angelo Zino, said, “It’s not like this is the end of the world for Google and Microsoft is going to eat its lunch in search. But ChatGPT is showing there is possible threat and that is causing a lot of fear.” Though there is tremendous excitement over ChatGPT, it may not remain the sole option for long. The Chinese search engine, Baidu, is planning to launch Ernie on the lines of ChatGPT.  The argument is that Microsoft may not gain much by using ChatGPT on its search engine, Bing, because Bing’s share of search engine is much too small compared to the 90 per cent share of the market by Google.

It is now clear that the tech giants are now gearing up to use AI devices to leverage their relative technological advantages. But it cannot be said that AI is the new kid on the block, and every one of the big players will have one of their own to do business. If there is a competition between AI devices, then there would be a more critical assessment of the products. Consumers will be less bamboozled as they are now by ChatGPT. The AI devices threaten to take over many of the intellectual exercises like looking up sources for preparing a legal brief, or interpreting correctly the data of a scientific experiment. The automation of the intellectual work seems to be a possibility, raising many ethical questions with regard to learning processes and the assessment of intellectual capabilities of students in schools and universities.

But it is the commercial aspect of AI that will concern the major tech companies. First, there is as yet no clarity as to how the functions of ChatGPT are to be monetised and in what way. Some market observers seem to think that it could be a costly mechanism, and it would be out of reach for a large number of people, at least initially. And once the competition gets going, then the price will fall. Like the Android device, many of the tech companies may use something like ChatGPT as an internal component. And Microsoft is wanting to use ChatGPT in a similar way. So, the economics of AI devices will play an important role in determining future commercial use. And also, the AI devices will be engineered to serve specific functions to meet the market demand, and this will likely lead to a different kind of AI contraptions.