What Google AI Chatbot Bard's blunder means for the AI race

What happened?

Shares of Alphabet Inc. tumbled 7.7% following the botched launch of its new search bot, Bard.

This misstep reveals deeper issues as the rise of AI-powered digital assistants threatens to disrupt the dominant business models of tech giants like Google.

Here are my insights:

• Botched launch of Bard
• LaMDA: The Power Behind Bard
• Disrupting the Disruptors

Botched launch of Bard

The botch came in the form of a widely-publicized online advertisement, in which Bard delivered an inaccurate answer to a prompt asking about the discoveries from the James Webb Space Telescope (JWST).

The response suggested that the JWST had taken the first pictures of a planet outside of our solar system, a mistake that was particularly damaging given the context of the prompt: “What new discoveries from the JWST can I tell my 9-year old about?”

We all hate fake news! It is not a nice feeling to be lied to.

Now, imagine lying to a 9-year old kid about the discoveries of JWST because of the wrong answers given by Bard. How damaging is that?

Hence, the error is embarrassing. With their billions in market capitalization and vast reserves of talent, it is unfathomable that Google can commit such a simple error.

The launch of Bard was meant to address the growing challenge posed by OpenAI's ChatGPT, but instead has left the tech giant vulnerable to falling behind its up-and-coming competitor.

LaMDA: The Power Behind Bard

Bard utilizes LaMDA, a state-of-the-art AI system developed by Google that generates human-like text responses to a wide range of questions.

LaMDA stands for Language Model for Dialogue Applications, and it functions as a virtual conversation partner that can understand and respond to questions in a conversational manner. The system is trained on massive amounts of text data, allowing it to generate contextually relevant and coherent responses.

This advanced capability sets LaMDA apart from other AI systems and makes it a valuable tool for applications such as chatbots, voice assistants, and even content creation.

With LaMDA powering Bard, Google aimed to deliver an AI-powered digital assistant capable of responding to a wide range of questions and tasks, including setting reminders and providing weather updates, as well as generating creative writing and poetry.

Disrupting the Disruptors

The rise of AI-powered chatbots like ChatGPT threatens to disrupt Google's dominant position in the search engine market, where its algorithms and vast reserves of user data have driven innovation and growth.

By providing quick and convenient answers to user questions, ChatGPT has the potential to bypass traditional search engines and cut into Google's lucrative advertising revenue.

Currently, the global search market is around US$200 billion. Microsoft’s Bing only account less than 5% market share, compared to more than 90% market share for Google. So, there could be severe financial impact for Google if ChatGPT disrupt the traditional search market.

The botched launch of Bard, powered by LaMDA, highlights the challenges facing tech giants in a rapidly-evolving technology landscape. As AI-powered digital assistants continue to gain traction, they will have a profound impact on the way we access and interact with information.

Companies like Google will need to find new ways to remain relevant and capitalize on the opportunities presented by this emerging technology, or risk being disrupted themselves.

The steep 8% drop in the shares price of Google is a warning that it could be disrupted if the company does not provide a meaningful response to Artificial Intelligence.  

The article is contributed by EdxCapital. You can read more of his investment insights on substack.