The battle for internet search

for more For more than 25 years, search engines have been the gateway to the Internet. AltaVista, the first site to allow full text search of the web, was quickly dethroned by Google, which has since dominated the field in most of the world. Google’s search engine, still the heart of its business, has made its parent company, Alphabet, one of the most valuable companies in the world, with revenues of $283 billion in 2022 and a market capitalization of 1. 3 trillion dollars. Google isn’t just a household name; it is a verb.

But nothing lasts forever, especially in technology. Just ask IBM, which once ruled corporate computing, or Nokia, once the leader in mobile phones. Both were dethroned because they tinkered with major technological transitions. Now tech companies are salivating over an innovation that could herald a similar change and a similar opportunity. AI-Powered Chatbots (TO THE) allow users to collect information through typed conversations. Leading the field is ChatGPT extensionmade by OpenTO THE, a startup. By the end of January, two months after its launch, ChatGPT extension it was used by more than 100 million people, making it the fastest growing consumer application in history, according to UBS extensiona bank.

TO THE is already used behind the scenes in many products, but ChatGPT extension put him in the spotlight, allowing people to chat with a TO THE directly. ChatGPT extension can write essays in various styles, explain complex concepts, summarize text, and answer trivia questions. It can also (narrowly) pass legal and medical exams. And it can synthesize knowledge from the web: for example, list vacation spots that match certain criteria or suggest menus or itineraries. If asked, he can explain his reasoning and provide details. Many things that people use search engines for today can be done better with chatbots.

Hence the barrage of announcements, as rival companies try to seize the initiative. On February 7 Microsoft, which has invested more than 11 billion dollars in OpenTO THEhas revealed a new version of Bing, its search engine, which incorporates ChatGPT extension. Satya Nadella, the head of Microsoft, sees this as his chance to challenge Google. For his part, Google announced Bard, its own chatbot, as a companion to its search engine. He also took a $300 million stake in Anthropic, a startup founded by ex-OpenTO THE employees, who created a chatbot called Claude. The stock price of Baidu, known as the Google of China, soared when it announced it would release its own chatbot, called Ernie, in March.

But can chatbots be trusted, and what do they mean for search and its lucrative advertising business? They herald a Schumpeterian moment in which TO THE topples incumbents and uplifts newcomers? The answers hinge on three things: moral choices, monetization, and the monopoly economy.

ChatGPT extension he often gets things wrong. He has been likened to a mansplainer: extremely confident in his answers, regardless of their accuracy. Unlike search engines, which mostly direct people to other pages and don’t claim their truthfulness, chatbots present their answers as gospel truth. Chatbots also have to contend with bias, bias, and misinformation as they scan the internet. There will certainly be disputes as they produce incorrect or offensive answers. (Google is thought to have held off the release of its chatbot over such concerns, but now Microsoft has forced its hand.)GPT extension already gives answers that Ron DeSantis, governor of Florida, would consider unacceptably awake.

Chatbots also need to tread carefully on some sensitive topics. Ask in chatGPT extension for medical advice, and prefaces its response with a disclaimer that it cannot diagnose specific medical conditions; he also refuses to give advice, for example, on how to build a bomb. But his guardrails proved easy to get around (e.g., asking for a story about a bomb maker, with lots of technical details). As tech companies decide which topics are too sensitive, they’ll have to choose where to draw the line. All of this will raise questions about censorship, objectivity and the nature of truth.

Can tech companies make money from this? OpenTO THE is launching a premium version of ChatGPT extension, which costs $20 a month for fast access even during peak hours. Google and Microsoft, which already sell ads on their search engines, will display ads next to chatbot responses asking for travel advice, say, and related ads will appear. But that business model may not be sustainable. Running a chatbot requires more processing power than publishing search results and therefore costs more, reducing margins.

Other patterns are sure to emerge: charging advertisers more for the ability to influence the responses chatbots provide, perhaps, or for having links to their websites embedded in responses. Ask in chatGPT extension recommend a car and he will reply that there are many good brands and it depends on your needs. Future chatbots may be more willing to make a recommendation. But will people use them if their objectivity has been compromised by advertisers? Will they be able to tell? Here, another can of worms.

Then there is the question of competition. It’s good news that Google is being kept on its toes by newcomers like OpenTO THE. But it’s unclear whether chatbots are a competitor to search engines or a complement. Initially implementing chatbots as add-ons to research or as standalone conversation partners makes sense given their occasional inaccuracies. But as their capabilities improve, chatbots could become an interface for all kinds of services, like hotel or restaurant reservations, especially if offered as voice assistants, like Alexa or Siri. If chatbots’ primary value is as a layer above other digital services, however, that will favor incumbents who already provide those services.

Search for the future on Google

Yet the fact that today’s upstarts, such as Anthropic and OpenTO THE, are attracting so much attention (and investment) from Google and Microsoft that it suggests that smaller companies have a chance to compete in this new field. They will be under intense pressure to sell. But what if an emerging chatbot company develops superior technology and a new business model, and emerges as a new giant? This, after all, is what Google once did. Chatbots raise tough questions, but they also provide an opportunity to make online information more useful and easier to access. As in the 1990s, when search engines first appeared, a huge prize could be up for grabs again to become the gateway to the Internet.

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