Microsoft and OpenAI have a first-move advantage in the exploding market for AI chatbots, according to Daniel Ives, managing director and senior equity research analyst at Wedbush Securities.
Through its early and continued backing of ChatGPT developer OpenAI, Microsoft is “leading so far” in the “Al arms race,” he wrote
Last week, Vole and Google held product events this week about their respective chatbot plans, Google’s event for its forthcoming Bard chatbot was “underwhelming,” according to Ives. Additionally, a Google ad for Bard, which featured an inaccurate piece of information served up by the chatbot, was “an absolute near-term gut punch to Google’s Al credibility,” Ives wrote.
Microsoft’s announcement of new versions of its Bing search engine and Edge browser that leverage OpenAI technology — including to offer a Bing chatbot that is similar to ChatGPT — was just the latest sign that Microsoft is clearly ahead at this stage, he wrote.
The company has been a backer of OpenAI since 2019 and reportedly invested more than $13 billion into the company so far, and the investment has clearly panned out with ChatGPT estimated by some to be the fastest-growing app ever.
Ives said in his note to investors that Google and Apple were just two of the other companies he expects to jump into the generative AI competition.
“This race will be a long one and we expect Google as well as Apple, Meta, and other tech stalwarts to spend billions in this Al arms race over the coming years,” he said.
