Google (GOOG, GOOGL) unveiled a round of new AI-focused features for its Search, Maps and Lens apps on Wednesday — and investors and experts weren’t too impressed.
Shares of Google’s parent company Alphabet fell nearly 8% in the hours following Google’s presentation on Wednesday, shaving nearly $100 billion off the company’s market cap. Shares fell another 5% on Thursday.
Wednesday’s event was held at Google’s Paris office just a day after Microsoft (MSFT) revealed its new version of Bing, which it is integrating with OpenAI’s much-talked-about ChatGPT. Google’s dominance in search once seemed untouchable, and the numbers certainly reflect as much – Google has over 80% market share, while Bing comes in at around 9%.
So, why did Google’s presentation on Wednesday raise red flags among investors? SEO expert Lily Ray says it’s a combination of things, starting with the fact that the company didn’t really announce much that was new at the end.
“Honestly, it [felt] The new features Google executives focused on at the company’s Wednesday presentation included things like “search your screen” for Google Lens, which is in beta in 2021.
The presentation also included the announcement that Google is rolling out its “Multisearch” option globally. The feature allows users to take a picture of a green chair, for example, then type in ‘blue’ to find the same chair available in blue for sale online. Ray has been excited about Multisearch and has been using it for about a year now.
“Multisearch is one of the most exciting things they’ve come out with in recent years, and I think it’s going to change the way we search,” she said.
Still, everyone was hoping for news about the Bard that would actually light up – and it never quite materialized.
Ray said, “We were all waiting for Bard news, but the announcement was in line with a blog post two days ago.” “We saw a very limited first look at how The Bard will appear in search results, but there’s not a lot of clarity on when or how often it will roll out.”
Finally, the presentation itself was, well, a bit un-Google-like.
“There was something amiss, and it didn’t seem like the most well-planned announcement from Google,” he said. It also didn’t help that the presentation ended abruptly, with Ray saying it was private on YouTube for a few hours. Video is from back up.
Google declined Yahoo Finance’s request for comment.
Google Inc. CEO Sundar Pichai speaks during an event in New Delhi on December 19, 2022. (Photo by Sajjad Hussain / AFP) (Photo by Sajjad Hussain / AFP via Getty Images)
‘We were expecting to be surprised’
At the same time, concerns have already been raised about the accuracy of bards, as an example of which Google used to promote its AI chatbot was not exactly accurate. Although the Financial Times report suggested that the example Google gave about the James Webb Space Telescope is not “wrong, on a technical level”, it is still a cruel omission on Google’s part. This kind of dilemma is also characteristic of the type of language model that both Bard and ChatGPT are at the core.
“A big challenge with these big language models is that they can’t say ‘I don’t know’ and instead give precise responses,” said Alex Ratner, CEO of Stanford AI Lab spinoff Snorkel AI. And often, the reaction falls short of the truth. This is because, in the end, a model is only as good as the data it is trained on, and a lot of the data we produce in the world is unstructured – that is, it is unlabeled and unclassified. Is.”
Meanwhile, what Microsoft announced yesterday is really new and, from an SEO perspective, innovative, Ray said.
“To me, this announcement was the most exciting and interesting step we’ve taken with Bing in a long time,” she said. “But like Google, they still have a lot of answers to answer about how this could affect online publishers.”
At its highest level, this is a battle that Microsoft is waging all out. In an interview earlier this week, Microsoft CEO Satya Nadella took a direct swing at Google, saying that as searches become more complex, they will become more expensive — and the higher margins that built Google’s business. Yes, it will fade away.
“From now on, [gross margin] The search numbers are going to go down forever,” Nadella told the Financial Times.
Nadella is right, and Google may have to reorganize the economics of its search business if it plans to run these ChatGPT-style searches, said University of Washington professor Luis Cies.
“Search is arguably the most ubiquitous technology in the world,” he told Yahoo Finance. “For context, Google processes approximately 8.5 billion searches per day… Because generative models are exceptionally large and complex, the process is computationally intensive, making it more difficult to perform than other types of deep learning models.” It becomes much more expensive to run.”
In the end, here’s where the market’s high expectations for Google collide with a reality no one totally expected,” said Michael King, founder and CEO of SEO agency iPullRank.
“We wanted to see something that was a game-changer and what we ended up with instead was talking about subtlety,” King said. “We were expecting to be amazed by this new integration and instead, we were greeted with ‘Did you know we invented technology?’”
“It really does feel like a role reversal,” King said.
elle garfinkel is the Senior Tech Reporter at Yahoo Finance. follow him on twitter @agarfinks and on LinkedIn,
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