For those who don’t already know, artificial intelligence (AI) is the word of the year in technology.
After the launch of OpenAI’s ChatGPT late last year, investors have been asking for some stocks that can claim a connection to AI. C3.ai The topic skyrocketed, but it’s been dropping recently.
alphabet (GOOG -0.14%) (Google -0.23%) Noticed. The tech giant has been under attack since ChatGPT’s debut, and Google executives have used every opportunity to argue for their AI investments. It reminded investors that it pivoted to an AI-first company a year ago and acquired DeepMind, a highly regarded UK AI research lab, in 2014.
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The call to rapidly evolving technology wasn’t lacking in the Q1 earnings call, and executives were happy to drum up AI once again. This includes the development of “state-of-the-art language models,” including a new conversational AI service, Bard, to empower developers and other creators and enable enterprises to take advantage of AI tools.
Executives discussed Workspaces, a suite of apps including Gmail, Docs and Sheets, and the role of AI in advertising, but much of the discussion seemed vague.
Seeking a killer app
Alphabet has been using AI for several years, but has yet to find an application to transform it like OpenAI did with ChatGPT. microsoft (MSFT 0.80%) It seems to be doing well with some product lines.
Most of the improvements the company has made with AI appear to be in-house rather than in customer-facing products. For example, Pichai shared that the company has been using large-scale language models (LLM) to improve search quality for the past few years, and CFO Ruth Porat said the company runs its finance organization. Even in the way he said he uses AI.
The problem with these uses is that they don’t make a big difference to your business or surprise your users. It’s not the transformative technology that investors imagine when they hear AI.
Alphabet’s reluctance to add a chatbot interface to Google Search like Microsoft’s Bing has today is understandable, but now that the technology is out there, how will the company use AI? We need to think more creatively about what we can do.
For now, Alphabet still appears to be on the defensive, but Microsoft is embracing the role of a bold disruptor in search thanks to new AI capabilities.
The Windows maker also mentioned deploying AI last quarter, but provided many concrete examples to back it up. For example, on LinkedIn, writers can get personalized suggestions from generative AI tools, which employers can use to create job descriptions.
GitHub’s AI-based Copilot makes code suggestions. Teams uses AI to provide real-time translations in 40 languages, and Azure’s OpenAI service uses access to generative AI tools such as GPT 3.5, Codex, and DALL-E 2 to translate text, code, and images. Create a. Microsoft now has over 2,500 Azure OpenAI customers, more than 10x its number last quarter. This includes top brands such as: Mercedes-Benz and shellindicating that the service is being rapidly adopted.
And, of course, the new Bing is the AI-driven product Microsoft is most excited about, having seen a fourfold increase in daily installs since its launch in February, according to its earnings call.
sign of 7 years
Alphabet touts its investment in AI over the years as proof of its strength and capabilities, but what if it were really the other way around? It reflects our inability to ship or leverage the research of the recently merged DeepMind and Google Brain.
Way back in 2016, Pichai declared Google to be an “AI first” company and made investments to back up that belief. We also bet on new products at the time, such as Pixel phones and Google Assistant, but they all fell through. But with OpenAI and Microsoft gaining early leads in AI, Pichai may have been right in AI direction, but seems to have failed in execution.
Microsoft CEO Satya Nadella is eager to challenge Google search with a “new competition,” but Pichai remains cautious, promising investors that the company will test and iterate and transform. It seems to be committed to progressiveness instead.
Alphabet may still have a killer app, but right now, despite spending billions of dollars on research and talking a lot about AI, it has more than investors have ever offered. is the right thing to ask of the search giant.
