Google v Microsoft: who will win the AI chatbot race?

Microsoft announced on Tuesday that it was using the technology behind ChatGPT, developed by the San Francisco-based company OpenAI, to enhance its Bing search engine and Edge web browser.

Google knew it had to respond after the OpenAI deal and the runaway success of ChatGPT. It said on Monday that Bard was undergoing specialist testing and would be made more widely available to the public in the coming weeks.

Microsoft is also unlikely to emerge unscathed from James Webb-type mistakes, experts said. Indeed, ChatGPT users have encountered inaccuracies while using the chatbot, the technology of which is underpinning the new-look Bing and other Microsoft products such as Teams.

However, the phenomenal interest in ChatGPT, which signed up more than 100 million users in two months, shows considerable public appetite for an AI-enhanced search experience. Fans of the chatbot have praised its ability to summarise documents, tidy up prose and write code (among many other things), while journalists given early glimpses of the new AI-powered Bing have been impressed.

There is a big gap to bridge between the companies: in its most recent quarterly results, Microsoft posted revenues of $3.2bn from search and news advertising, while Google generated $42.6bn in search revenues. Chatbots also require a lot of processing power, so there are also cost implications for any AI-powered market grab, as well as defending a market-leading position.

Google has invested heavily in AI and its use is everywhere in its products (in Google Translate, for instance). Alphabet also owns the UK-based DeepMind, a leading AI research firm. Google remains in a strong position.