Alphabet Inc, the parent company of Google, saw a decrease of $100 billion in market value on Wednesday following a promotional video for its new chatbot containing incorrect information and a lacklustre company event. This has raised concerns that the tech giant needs to catch up to its competitor Microsoft.
Footage of Google’s botched Bard Chatbot demo that wiped $100B from its market cap pic.twitter.com/tAJnrPysh9
— Trung Phan (@TrungTPhan) February 8, 2023
During regular trading, Alphabet’s shares dropped by as much as 9%, with volumes nearly three times higher than the 50-day average. Although they recovered some losses after hours, they remained roughly unchanged. Despite losing 40% of its value last year, the stock has rebounded by 15% this year, excluding Wednesday’s losses.
Microsoft after Google's AI demo failed pic.twitter.com/Pc3FlxuQEe
— Genevieve Roch-Decter, CFA (@GRDecter) February 8, 2023
A mistake in Google’s advertisement for its chatbot, Bard, was first reported by Reuters. The error pertained to which satellite took the first photos of a planet outside the Earth’s solar system.
Google has been struggling after OpenAI, a startup supported by Microsoft with approximately $10 billion, launched the software in November that has received praise from consumers for its accurate and well-written responses to simple questions. This has become a hot topic in Silicon Valley.
Google’s live presentation on Wednesday morning failed to provide information about the integration of Bard into its search function. The day prior, Microsoft held an event where it announced the release of a version of Bing search with integrated ChatGPT functions. Just before the presentation, Google, located in Mountain View, California, discovered the error in Bard.
What is the future of Bard with google in 2023
An analyst at D.A. Davidson, Gil Luria, commented on the situation, saying, “Although Google has been at the forefront of AI innovation in recent years, they appear to have dropped the ball when it comes to implementing this technology into their search product.
In recent weeks, Google has been scrambling to catch up on the search, resulting in yesterday’s rushed announcement and the embarrassment of providing an incorrect answer during the demo.”
Shares of Microsoft rose by about 3% on Wednesday and remained unchanged after the market closed. Alphabet shared a short video of Bard via Twitter, claiming it would help simplify complex subjects, but it delivered an incorrect response instead.
Here they all come. pic.twitter.com/mPiL2EjCLv
— Theebeardedbard ? (@TheeBeardedBard) February 8, 2023
Alphabet’s market value plummeted by $100 billion after its latest chatbot, Bard, shared false information in a promotional video. This, along with the company’s recent event falling short, has raised concerns that Google’s parent company is losing its competitive edge to Microsoft.
The mistake in the advertisement was discovered by Google before the presentation and showed that the chatbot inaccurately claimed that the James Webb Space Telescope took the first pictures of a planet outside of our solar system, which was taken by the European Southern Observatory’s Very Large Telescope in 2004.
