Alphabet Inc., the parent company of Google, lost $100 billion in market value on Wednesday after a new chatbot called Bard failed to impress at a company event. Alphabet’s shares dropped as much as 9% in regular trading with volumes nearly three times the 50-day moving average.
The stock had already lost 40% of its value last year, but rallied 15% since the beginning of this year, excluding Wednesday’s losses.
The drop in value came after Bard made an error in a promotional video that Reuters first pointed out. In the advertisement, Bard was asked “What new discoveries from the James Webb Space Telescope (JWST) can I tell my 9-year old about?” Bard responded with incorrect information, suggesting that the JWST took the first pictures of exoplanets outside the Earth’s solar system.
However, NASA confirmed that the first pictures of exoplanets were taken by the European Southern Observatory’s Very Large Telescope in 2004.
Google’s presentation on Wednesday morning did not include any information about integrating Bard into its core search function. Meanwhile, Microsoft held an event on Tuesday to announce that it had already integrated chatbot functions into its Bing search engine.
The error by Bard raised concerns that Google is losing ground to its rival Microsoft, who is backed by OpenAI, a startup with around $10 billion in funding. OpenAI introduced software in November that has impressed consumers with its accurate and well-written answers to simple prompts.
“While Google has been a leader in AI innovation over the last several years, they seemed to have fallen asleep on implementing this technology into their search product,” said Gil Luria, senior software analyst at D.A. Davidson.
“Google has been scrambling over the last few weeks to catch up on Search and that caused the announcement yesterday to be rushed and the embarrassing mess up of posting a wrong answer during their demo.”
Microsoft’s shares rose around 3% on Wednesday, and remained flat in post-market trading. However, King Lip, Chief Strategist at Baker Avenue Wealth Management, cautions that concerns about Alphabet may be overblown and that “Bing is a far, far cry away from Google’s search capabilities.”
ChatGPT software has created excitement among technology firms after tens of thousands of job cuts in recent weeks and executive pledges to cut back on “moonshot” projects. AI-driven search could provide results in plain language, making browsing faster and more efficient.
Chatbot AI systems, however, carry risks for corporations due to biases in algorithms that can skew results or produce plagiarized content.
Are we heading toward the collapse of mind-guided decision making?
The recent failure of a chatbot named Bard at Alphabet Inc. has brought to light if we are on the way to the total collapse of the mind-guided decision-making age. It’s because the incident, which cost Alphabet $100 billion in market value, highlights the potential risks that companies face when they gradually develop their habit to rely solely on AI systems without proper human checks and balances.
AI evolution of this kind initially underscores, and eventually leads to demote human intelligence, the crucial role of human decision-making in guiding AI systems and preventing costly errors.
That’s why, despite the potential of AI systems to revolutionize the business world, the limitations of these systems must be acknowledged. AI systems, like Bard, are only as good as the data they are fed and can only provide answers based on the information they have been trained on.
This means that these systems are susceptible to errors, biases, and misinformation. In addition, AI systems can only provide answers to questions that have been programmed into them, and may not be able to provide context or explain their reasoning behind the answers.
While AI has the potential to significantly improve the speed and efficiency of decision-making processes, the events surrounding Bard serve as a reminder that AI systems are not a replacement for human judgment and expertise. Companies must ensure that AI systems are used in conjunction with human oversight to ensure that their decisions are accurate, ethical, and fair.
AIs represent just one of the latest modern fashions and they currently are highly over-rated. Using them only as a tool will be possible when we sincerely integrate the systems into the business world, which requires a balance between the speed and efficiency that AI provides, and the critical thinking, creativity, and judgment that human beings bring to the table.
