The AI arms race itself may be somewhat controversial, but I think we can all agree that no one wants AI hallucinations. SoundHound (NASDAQ: SOUN) is trying to stop and Alibaba (NYSE: Bubba) is poised to roll out its own chatbot, with SoundHound’s share skyrocketing. SoundHound jumped him 8.3% in Monday’s trading session. This is largely thanks to its new potential connections.
Some analysts are puzzled as to why SoundHound’s stock has soared. SoundHound is most widely known for its music recognition tools, but there are lesser-known features that could do well with new AI developments like Alibaba’s new chatbot. SoundHound uses ChatGPT in both the iOS and Android Chat AI apps to prevent so-called “AI hallucinations,” based on reports from SoundHound itself.
AI hallucinations sound a little more horrifying than they actually are. SoundHound’s systems can choose the ‘best answer’ to any question asked, whether they need to take advantage of Large Language Models or migrate these systems to Generative AI. More specifically, SoundHound looks to its own language known as CaiLAN (Conversational AI Language) to help better interpret what is being asked. Ultimately, this should produce better results and be more attractive to potential users. Especially large Chinese e-commerce sites like Alibaba.
This sounds exciting, but insider trading at SoundHound suggests insiders don’t expect this to work. In the past three months, insiders have sold a total of $817,200 worth of stock. This is enough to make insider sentiment very negative.
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