ChatGPT, COGS, and wishful thinking

LinkedIn is filled with speculations about why it took Google so long to announce a competitor ChatGPT, in general, and more specifically a conversational AI search engine.?

Looking at the data, I really believe that Google could announce that a long time ago. Google is one of the most AI-capable companies in the world, especially in terms of NLP and LLMs. They have been innovating with LLMs for years. Lambda, which looks (at least in concept) very similar to ChatGPT (and it was declared mid-2022).?

So when everybody asks why they haven't released an answer to ChatGPT, I ask why weren't they the first ones to throw the punch.

There are a few popular opinions circulating on LinkedIn about why it took Google so long to develop a competitor for ChatGPT. One suggestion is that Google was focusing on other AI technologies, such as image and speech recognition, and did not prioritize the development of a language model. Another possibility is that Google, as a more established company, is less willing to release an "uncooked" product and may have taken more time to refine its language model. Additionally, some speculate that as a larger company with more established revenue streams, Google has less flexibility to "lose" money on research and development compared to a startup like OpenAI. These are just a few of the many opinions on the topic.

Focus?

It's interesting to see that Google has shown a significant interest in conversational AI, as evidenced by the announcement of Lambda on 5-22, a conversational model before ChatGPT was even released. Lambda was designed to help developers create natural and engaging conversational experiences for various devices and applications.

Maturity?

Google has a well-established reputation for being a fast-moving and innovative company. They have a track record of releasing features quickly and have a process for declaring experimental features. Microsoft is also a large and established company and may be more cautious in releasing new features compared to Google. If the reason ChatGPT is out is the fact that it was created by a startup and not directly by Microsoft, well - Google could invest in a startup just as easily.?

Profitability and reports

Google's search engine is a significant and profitable segment of their business, and it's understandable that the company would want to maintain high margins in this area. However, it's also true that Google has invested significant resources in developing Lambda and other conversational models. From a financial reporting perspective, these kinds of investments may not necessarily reduce the profitability of the search engine segment, as they represent innovative technologies that could be categorized as investments rather than expenses. Additionally, language models like ChatGPT have significant potential for driving new revenue streams for Google, such as through the development of new products or services. While it's important for Google to maintain profitability, the company's history of investing in new technologies and acquisitions indicates that they are willing to make strategic investments to achieve long-term growth and success. And another thing - its not really a great comparison to look at Google directly versus openAI, I believe Google should be considered versus Microsoft in terms of investments and spending in this case, given the huge capital investment MS made in OpenAI.?

When no news is good news?

Is it possible that Google may not have wanted ChatGPT or conversational AI to become the new standard for search engines? The search engine segment is already highly profitable for Google and the company dominates this space. While innovation in this domain can lead to higher market capitalization and financial results for Google, there are potential risks to consider. One such risk is the potential for new players to take market share from Google as the market shifts towards conversational AI. Additionally, the higher computational demand required for conversational AI could result in lower overall margins in this domain. It's important to note that these risks are speculative

Consider this -?

This is the bing AI announcement - around early 2-23 https://blogs.microsoft.com/blog/2023/02/07/reinventing-search-with-a-new-ai-powered-microsoft-bing-and-edge-your-copilot-for-the-web/ Look when google announced Bard, around the same time? https://blog.google/technology/ai/bard-google-ai-search-updates/ It almost seems like while ChatGPT was making waves, two giants were having a standoff on a shaky branch. Which is odd, given that one of them was financing the act of shaking the tree.

market fragmentation

It's pretty clear that conversational AI creates a shuffle in the search engine market, my guess (and probably everybody's) is that it will result in a bigger overall market cap, but the implications on the competitive landscape and overall margins are not clear yet.?

When the worst case is not all bad

In the overall analysis I believe that Microsoft had any reason to start this change, best case scenario they win a market share, worst case scenario, they make one of their biggest competitors’ life much worse.

What's next?

Will Google retaliate? Maybe, will they both benefit so much from providing infrastructure for generative AI and new services besides search engines that will grow around the new ecosystem. Probably.?

I know one thing, the timelines in this story suggest there is much more to know about the motives that played a part here, I hope we will know more about them one day.