Software titan Microsoft (NASDAQ: MSFT) thought it had found a "Google-killer" in its tight partnership with OpenAI and the ChatGPT artificial intelligence (AI) system. Six months later, market reports show that the AI-boosted version of the Bing search engine still plays second fiddle to Alphabet's (NASDAQ: GOOG) (NASDAQ: GOOGL) Google -- and the gap isn't shrinking.
That's the big takeaway from a Wall Street Journal report this week. Beyond just looking at the data, the paper interviewed several search market experts. One of them, former Google and LinkedIn employee Daniel Tunkelang, called the revamped Bing effort "cute, but not a game-changer."
Tunkelang's quip is an effective summary of the situation. Baking ChatGPT into the Bing experience didn't add much real-world value to the search tool, and market data shows that Bing also didn't add many new users this way.
This turn of events highlights Google's resolute hold on the online search market. It also shows that AI tools' genuinely game-changing days still lie ahead. It's a little early to long-term winners in this race that's barely started, but preparing for the upcoming sea change is a good idea.
Bing's AI integration: Ambition meets reality
Citing market data from analytics firms StatCounter and SimilarWeb, the Journal noted that Bing held a 3% share of the global search market in January. The ChatGPT integration was launched in February, hoping to deliver a better search experience that could steal market share from Google.
However, Bing's market share never spiked. Six months into the ChatGPT-boosted Bing experience, StatCounter's data shows no significant change, and Bing still sits at a 3% share. Google's dominant slice of this pie faded from 93% to 92% over the same period.
The progress doesn't change much if you look at U.S. search shares instead. This is Bing's strongest showing overall and has been for years, but its market share dropped from 6.7% to 6.5% over the last six months. Here, Google rose from 88% to 89%. Again, not much has changed.
Other studies show similar results. There's no denying it -- ChatGPT has failed to light a fire under Bing's search traffic.
Image source: Getty Images.
Why ChatGPT isn't dethroning Google
The almost entirely unchanged market share data suggests it will take more than a popular AI toy to unseat Google from this throne. In particular, ChatGPT is not designed to find facts and existing online resources. It generates text based on patterns found in a very large collection of text samples. If this tool finds an objectively correct answer to your questions, you won't get a quotable source for it.
Earlier this week, the Associated Press updated its guidelines for using generative AI in news reports. "AP has a licensing agreement with OpenAI, the maker of ChatGPT, and while AP staff may experiment with ChatGPT with caution, they do not use it to create publishable content," the guidance statement said. "Any output from a generative AI tool should be treated as unvetted source material."
And I think that's why people didn't flock to the ChatGPT features in Bing. These AI tools are known to make things up on the spot and present the resulting nonsense as a known fact. Both ChatGPT and Google Bard have slipped into that bad habit during press events in the early days of the ChatGPT frenzy.
That's not the quality of information I want if I'm looking up how to rewire the electronics in my dishwasher or bake a cake for my daughter's birthday. Even a mild "hallucination" could electrocute me or make the cake inedible -- I'm not sure which one's worse.
So it makes sense that people aren't relying on ChatGPT's contributions to Bing's online search results -- the chatbot wasn't designed to serve that purpose, and its shortcomings are well known.
What the Bing experiment teaches us about AI in tech
Looking back at this period from 2030 and beyond, I'm sure it will all seem quaintly obvious. AI has been around for decades, but the push to make consumer-facing tools out of it is newer. I can't fault Microsoft for seeking a market-moving advantage from the chatbot integration in Bing. At the same time, I'm not surprised to see the attempt fizzle.
Google built its commanding market share the hard way, creating a better search engine than AltaVista and WebCrawler in 1998. Other tools might eventually replace it, but the public is not yet ready to abandon the familiar search experience in favor of a gabby chatbot.
Microsoft, Google, and any tech giant worth its salt are working hard on other AI ideas with serious business potential. I don't have insider information about these projects, but I can't wait to see them hit the internet over the next few years. Cramming ChatGPT into Bing wasn't a hit in 2023, and Google is still the leader in online search services.
And the beat goes on.
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Anders Bylund has positions in Alphabet. The Motley Fool recommends Alphabet and Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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