Alphabet Inc saw a $100 billion loss in market value on Wednesday after its new AI chatbot, Bard, shared inaccurate information in a promotional video and the company’s event failed to impress. Alphabet shares dropped as much as 9% during regular trading with volumes nearly three times the 50-day moving average. They recovered after hours and were roughly flat. The stock had dropped 40% last year but had rallied 15% since the start of the year, excluding Wednesday’s losses.
Reuters was the first to point out the error in Google’s advertisement for the chatbot, which debuted on Monday. The ad asked Bard what new discoveries from the James Webb Space Telescope (JWST) can be told to a 9-year old about, and it responded with a number of answers, including one that suggested the JWST was used to take the first pictures of a planet outside the Earth’s solar system, or exoplanets. The first pictures of exoplanets were, however, taken by the European Southern Observatory’s Very Large Telescope (VLT) in 2004, as confirmed by NASA.
Google is moving quickly to keep up with OpenAI, a startup Microsoft is backing with around $10 billion, which released software in November that has become a fixation in Silicon Valley circles for its accurate and well-written answers to simple prompts. Google’s live-streamed presentation on Wednesday morning did not include details about how and when it would integrate Bard into its core search function, while Microsoft held an event the day before touting that it had already released to the public a version of Bing search with ChatGPT functions integrated.
Google has acknowledged the importance of a rigorous testing process and is launching its Trusted Tester program this week. “We’ll combine external feedback with our own internal testing to make sure Bard’s responses meet a high bar for quality, safety and groundedness in real-world information,” a spokesperson said.
Microsoft shares rose around 3% on Wednesday, and were flat in post-market trading. Alphabet is coming off a disappointing fourth quarter as advertisers cut spending, and the search and advertising giant is bringing in founders Sergey Brin and Larry Page to accelerate its efforts.
AI has become a fixation for tech executives who have mentioned it as much as six times more often on recent earnings calls than in prior quarters, Reuters found. The appeal of AI-driven search is that it could spit out results in plain language, rather than in a list of links, which could make browsing faster and more efficient. It remains unclear what impact that might have on targeted advertising, the backbone of search engines like Google.
Chatbot AI systems also carry risks for corporations because of inherent biases in their algorithms that can skew results, sexualize images or even plagiarize, as consumers testing the service have discovered. Microsoft, for instance, released a chatbot on Twitter in 2016 that quickly began generating racist content before being shut down. And an AI used by news site CNET was found to produce factually incorrect or plagiarized stories.
At the time of writing, the Bard ad had been viewed on Twitter more than a million times. People are beginning to question if Microsoft will be a formidable competitor against Google’s search capabilities, but it is still a far cry away from Google’s search capabilities. The error by Bard highlights the importance of a rigorous testing process and external feedback to ensure the responses meet a high bar for quality.
