Artificial intelligence leader OpenAI on Thursday unveiled SearchGPT, a challenger to Alphabet's core advertising business. Google stock fell on the news.
"We're testing SearchGPT, a temporary prototype of new AI search features that give you fast and timely answers with clear and relevant sources," OpenAI said on Elon Musk's X social media platform, formerly Twitter. "We're launching with a small group of users for feedback and plan to integrate the experience into ChatGPT."
OpenAI launched ChatGPT, its popular chatbot, in November 2022. OpenAI's ChaptGPT provides answers to prompts while Google's search engine sends users to websites, sponsored or not.
While OpenAI trained ChatGPT on data two years old, SearchGPT has real-time access to the internet.
On the stock market today, Google stock fell 3.1% to close at 167.28.
OpenAI's technology has been integrated into Microsoft's Bing search engine. However, Google hasn't lost much market share. Microsoft is the biggest investor in OpenAI.
Further, Google faces a new internet search challenger in well-funded startup Perplexity.
Google Stock: AI Overviews Rolled Out
Google began widely deploying AI Overviews in the U.S. in mid May, with conversational summaries topping links for many search queries. Also, Google plans to expand AI Overview's availability globally to 1 billion users by year end.
One key question for investors is whether tech industry incumbents will be the big generative AI winners. Further, OpenAI has told employees its now on an annual revenue run-rate of $3.4 billion, up from $2 billion in January. But analysts say OpenAI could still be losing billions of dollars annually.
Also, Google stock fell 5% on Wednesday. Alphabet is now up only 21% in 2024. Google stock hit a new all-time high of 191.75 on July 10 but has pulled back since then.
Meanwhile, Microsoft and Google are among AI stocks to watch.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
