Google Confronts Pressure to Respond to ChatGPT Threat as Search Business Faces Innovator's Dilemma

By Shawn Smith,

Published on Feb 4, 2023   —   2 min read


Google declares "code red" in response to the popularity of OpenAI's ChatGPT, as CEO Sundar Pichai announces LaMDA's release in the coming weeks.

It was only a matter of time until I read an article about how "someone" would respond to OpenAI's ChatGPT. This piece was inspired by Parmy Olson's opinion on Bloomberg. (Always a fan of her work).

Google, one of the largest tech firms in the world, is facing an innovator’s dilemma as it comes under pressure to respond to ChatGPT, the OpenAI tool that has the potential to revolutionize internet searching. Google's search business, which makes money every time users click on ads and links, is worth $150 billion, and the use of synthesised answers to queries could decrease clicks and thus, revenue. However, CEO Sundar Pichai has announced that Google will make its AI-based language model LaMDA available soon, and people could use it as a "companion to search."

Google has a strong background in AI, owning DeepMind and inventing the transformer technology that powers ChatGPT. However, the fear of cannibalizing its own search results or making mistakes has prevented LaMDA from being released. Google must now incorporate a chatbot into its search platform, but it must be careful not to provide incorrect or harmful advice. With the web becoming flooded with AI-generated content, Google’s search algorithms will need to work harder to rank quality content.

Google has declared an internal “code red” in response to the popularity of ChatGPT and has reassigned teams to work on AI prototypes. CEO Pichai has even called back Google founders to help strategize Google’s response. However, pressure from antitrust regulators is growing and a lawsuit from the Department of Justice threatens to break the company up. Google must now put aside its cautious approach to innovating and use its in-house expertise to compete with Microsoft-funded OpenAI. Pichai’s announcement of LaMDA's release in the coming weeks shows the threat he sees in ChatGPT.

A bit of an aside. Microsoft, on the other hand, doesn't have a major presence in the search market and has recently invested heavily in OpenAI's ChatGPT. This move shows their recognition of the potential of AI-powered conversational search and their willingness to enter the market and compete with the big players. However, the challenge for Microsoft will be to find a way to effectively integrate ChatGPT into their existing offerings and make a significant impact in the search market and other toolsets (GitHub already has it with CoPilot). It remains to be seen how successful Microsoft will be in this venture, but their investment in ChatGPT highlights the growing importance of AI in the tech industry and the changing landscape of search and information retrieval.

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