Just last week I predicted that Google would leverage ChatGPT to create a conversational interface to its search business, and that Microsoft would do the same in the enterprise data market. I briefly considered that I might have gotten it exactly backwards – Google has a robust enterprise data business in its cloud business (known as GCP), and of course Microsoft has Bing. But I quickly dismissed that notion – figuring that each behemoth would play the GPT card toward their strengths.
While I may have been right about ChatGPT getting a business model this year, it looks like I could be wrong on the details. Here’s The Information with a scoop:
Microsoft is preparing to launch a version of its Bing search engine that uses the artificial intelligence behind ChatGPT to answer some search queries rather than just showing a list of links, according to two people with direct knowledge of the plans. Microsoft hopes the new feature, which could launch before the end of March, will help it outflank Google, its much bigger search rival.
The link is behind a rather expensive paywall (I’m a newly refreshed subscriber), but Engadget and many others have more. Apparently Microsoft negotiated the right to integrate ChatGPT into Bing as part of its $1 billion investment back in 2019, and the fact that Bing’s version could launch as early as March means both OpenAI and Microsoft have been working on this for quite some time.
This leaves so many interesting questions unanswered. Might Google possibly do the same? And more interestingly – can it? Did OpenAI and Microsoft cut an exclusive deal for that initial $1 billion investment – effectively icing Google out? And if they did, is that consistent with the “open” vibe in OpenAI’s very name? In short, is OpenAI going to be an arms dealer, or has it been effectively captured by Microsoft, at least in the search arena? And what about the enterprise?
The Information notes that Microsoft is already repackaging previous versions of OpenAI technology for enterprise clients, and I still think the enterprise is where Microsoft will end up making the most of its partnership with OpenAI. But this news leaves me wondering – what will Google do next?
Partnerships present one of the most consistent strategic conundrums in business. Entire philosophies are built around how companies respond to competitive threat – should we build, or should we buy? Should we partner, or should we compete? Often companies with clear market dominance – like Google in search – will refuse to partner, certain that they have the technical and business scale to beat back new market entrants. In other cases, larger companies will partner for a while, then build their own tech in time (Apple and Intel come to mind).
In the case of OpenAI and ChatGPT, there seem to be two interlocking questions: First, can Google even leverage ChatGPT technology, or has Microsoft boxed them out? And second, if OpenAI is willing to partner, will Google chose to, or will it go its own way?
The answers may lie in another, more abstract question: Is conversational search the future of our information ecosystem, or is it a fad? This all reminds me of the debate around user interfaces in the 1980s. The launch of the Macintosh in 1984 was widely dismissed as a parlor trick by most in the early computer business. While the interface was lovely, and clearly beguiling to the noobs who didn’t matter to “real” computer users, there was no way a clunky “point and click” interface was going to replace the specialized skills mastered by the keyboard jockeys of MS-DOS and Unix.
I’ve long argued that Google represented a command-line interface to the Internet – and over the years, the company (and many others) have labored under that framework, even as they roll out any number of bells and whistles on top of it. But conversational search – a term I’ve been using for nearly twenty years – is potentially as different an experience for the end user as the Mac was to the IBM PC. The rub lies in that “potentially.” For Microsoft, I suppose, there’s not much to lose in trying something radically new. Its search business is less than one-tenth the size of Google’s. For Google, however, it’s fundamentally risky to go all in on a new approach – the old way is simply making them too much money. The company faces a classic innovator’s dilemma – and it will be fun to watch how it responds this year.
Google Brain and Google Research published the seminal “Attention is All You Need” paper in December 2017 and the Transformer model was born. Google Translate uses it, and they along with AWS and Microsoft have large language models as well as the Allen Institute. So it is not clear that OpenAI has cornered the market, as it were, in this technology. That said, foundation models will bring about big changes.