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There is an emerging conviction in the market that Microsoft will soon follow Apple in achieving a $3 trillion market capitalization. Given the current hype around everything AI-related, this prognostication might well pan out. However, Bing – that perennial laggard in the world of search engines – does not appear to be playing any significant role in achieving this milestone.
OpenAI has shot to prominence in recent months as its ChatGPT generative AI has captured the imagination of a global audience yearning for the next big disruptor in the tech sphere. Microsoft has emerged as the biggest beneficiary of the rise of the ChatGPT phenomenon on the back of a unique partnership deal with OpenAI. The tech giant announced back in January 2023 that it was investing an additional $10 billion in OpenAI, bringing its total investments in the revolutionary company to $13 billion. In return for providing this funding, as well as access to its cloud-computing service Azure, Microsoft has received rights to 75 percent of OpenAI's profits until the tech giant is able to recoup the entirety of its $13 billion investment. Thereafter, Microsoft will receive 49 percent of OpenAI's profits until these returns reach the $92 billion mark, after which Microsoft's shares will revert to OpenAI's non-profit foundation.
Meanwhile, Microsoft has been enthusiastically incorporating OpenAI's toolkit in its cloud-based services as well as the Office suite of products. Critically, the tech giant fully integrated its Bing search engine with ChatGPT, prompting some analysts to call for Google to lose its dominance in the search sphere to Bing.
“.. For what it’s worth, no one asks me about the potential for Bing to take share from $GOOGL any more. .. Bing's momentum appears to have been short-lived as web traffic relative to Google has reverted to where things stood pre-ChatGPT launch 7 months ago.”
- Bernstein desk pic.twitter.com/uZiSc5VhZ0
— Carl Quintanilla (@carlquintanilla) July 11, 2023
This brings us to the crux of the matter. Back in March, ChatGPT and Bing started outshining Google based on a measure of relative web traffic. However, as tabulated by the analysts at Bernstein, Bing's outperformance over Google was very short-lived, barely lasting for six weeks. Since then, Bing's traffic has reverted to its pre-ChatGPT snail's pace norm, with Google's search numbers largely stabilizing following an initial dump in early March.
Interestingly, ChatGPT is also losing momentum and now appears to be heading toward a convergence with Google's search numbers. This partly reflects the "Chinese room" nature of ChatGPT and other similar AI offerings at this time, given the fact that these models do not possess true inference capabilities but rather rely on a huge training dataset to deduce which words should follow specific prompts.
