Forum Topics Alphabet (Google)
Solvetheriddle
one year ago

this is a balanced view of AI MSFT/GOOG etc for any one that is interested. its about 50min but the first 30 minutes are relevant.

i must say that it does not take much for frenzied panic to take hold........i shouldnt be surprised, should i :)


https://podcasts.apple.com/us/podcast/the-ai-revolution-with-silicon-valley-veteran/id1653747327?i=1000600010554

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Mujo
one year ago

A good article on what is occurring in the Microsoft Bing v Alphabet Google battle: Is Google’s 20-year search dominance about to end? | The Economist

Some key quotes:

"Brian Nowak of Morgan Stanley, a bank, estimates that serving up an answer to a Chatgpt query costs roughly two cents, about seven times more than a Google search, because of the extra computing power required. He reckons that every 10% of Google searches that shift to an ai-powered application by 2025 will, depending on the number of words in an average response, add between $700m and $11.6bn, to Google’s operating costs, equivalent to between 1% and 14% of such spending in 2022."

"To complicate matters further, many costly conversational-search queries will generate little or no ad revenue. Google has said that 80% of its search results do not contain lucrative ads at the top of the search results. Many of these ad-light searches are almost certainly “informational” (“what is the capital of Spain?”), precisely the sort of query where chatbots are most useful—and precisely the sort that advertisers are least interested in (it is hard to know what ad to place next to the word “Madrid”). For generative ai to make real money, it will need to find uses in “navigational” searches (looking for a site’s internet address by its name) and especially “commercial” ones (“Best new ski boots this season”)."

"Google’s other advantage is incumbency. It is the default search engine in Chrome, Alphabet’s browser, which is used by two in three people on the internet, according to StatCounter, a research firm. It is also the go-to search on more than 95% of smartphones in America. The firm also pays Apple roughly $15bn a year to make its search the default on Apple’s devices, such as iPhones, and Safari browser, which accounts for 19% of browsers installed on desktops."

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Mujo
one year ago

Quick follow up, Ben Evans covers a lot of the digital advertising industry in his 2023 presentation (and other tech trends) - Presentations — Benedict Evans (ben-evans.com)

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Mujo
one year ago

Further to this looks like Bing isn't any better either yet despite the hype - Bing AI Can't Be Trusted - by Dmitri Brereton - DKB Blog

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Mujo
one year ago

I agree i think margins come down slightly but i think google will remain a near monopoly. Microsoft played the latest marketing round very well. If Google gets a better control of costs than they have in the past they can easily do well from here. Ex cash and excess costs i would think Alphabet is not trading that far off 12x earnings - though not sure how advertising revenue does short term now they are almost the market and we see more of a snapback from elevated online spend short term. Long term in any case i think it’s attractive.

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Solvetheriddle
one year ago

If you guys are keen there are MANY articles on seeeking alpha on this topic, they range from the end of the world for GOOG, to chatbots will have little impact, strong views at both ends of the argument, lol. you have to hand it to Nadella, MSFT came out with an average result and all everyone is talking about is MSFT AI potential--he is smart. as for GOOG, they are leaders in AI, but actually incorporating and using this technology in a profitable way in the search engine, is the tricky part.

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Mujo
one year ago

Thanks @Solvetheriddle I just subscribed for Premium yesterday so will have to have a look.

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lyndonator
one year ago

I have been thinking a lot about this lately and there are is a lot to consider in the Google vs ChatGPT debate.


The most obvious for me is: "Is ChatGPT (note I'm using ChatGPT as a synonym for any chatbot/ language model) actually a replacement for search?"

Now, I do think ChatGPT is revolutionary and that it, and models like it, will drastically change our lives in the coming years - doing it in ways we can't yet imagine. I also think there are elements of search that ChatGPT will do much better than Google currently does - but I'm not sure it will do the "I'm looking for the best company that sells this thing I want to buy" kind of search better, AND those searches are the ones that make Google the money.

Google have done a lot of work to make sure the quality of websites it recommends is good (or as good as it can be). Why would a language model repeat this work when, if the request of it meant it needed to return a website, it could just use google itself and maybe get a kick back from any advertising revenue (see more on this below)?


"OpenAI (via ChatGPT) have caught Google with their pants down and it is all over for Google coz they can't compete"

OpenAI have done it first, but they have no proprietary data or major IP advantage (that I know of - feel free to tell me I'm wrong here). I believe they are just the first and now they have shown that it can be done (and how stupidly excited the world got about it) it will be replicated by others. And like all things, the more it is done, the cost of doing it will get cheaper. Google already have done a lot on language AI - hence them coming out with bard (albeit quite unsuccessfully) so quickly - I think the reason they hadn't release their own ChatGPT, at least in part, is they didn't see how it would make them money. Which leads to...


"There is not yet a business model for ChatGPT" (Again, someone please jump in and tell me I'm wrong here)

The popularity of ChatGPT has just turned it into a money pit and Microsoft had to come in to bail out OpenAI. To me it is not an application itself, but a feature (an absolutely AMAZING feature) of another application. I think this means we are now in a race to see who can most successfully integrate language models into their applications. Side note: I think the first company to, successfully, turn something like ChatGPT into a digital personal assistant will kill it. Add to this that it relies on scraping data from websites that are built with the expectation of people actually visiting - it's gotta be careful it does not cannibalise it's own source of data and make sure money still flows to those that have provided the data it uses.


I own a small amount of Google which I'm holding for now. And if it drops to $80 I'll definitely buy a bit more. I'm definitely keen to see how this whole space shakes out




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Mujo
one year ago

Great read on the history and opportunity of Alphabet - Investor+Letter+2022+ENG.pdf

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Solvetheriddle
one year ago

re OpenAI --chatbox

IMO this is the best article i have read on the issues GOOGl face with this new technology. (mainly because i agree with it--lol), it is not the technology itself but the profitable integration into the search function which brings with it some conflicting issues-which to optimize. likely GOOGL has been wrestling with these issues for a while.

btw never having used tik tok i found the reference to financial advice on TT bizarre, isnt TT all talking dogs and young women dancing in bikinis!


https://seekingalpha.com/article/4566868-googles-core-advertising-could-suffer-own-innovations#comments

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Timocracy
one year ago

The next generation of “new” internet companies will have to grapple with making sure AI search points them to a solution that the AI itself can’t provide which is almost a catch 22.

Perhaps the future is a “Spotify model” of paying $0.000002 per play/click to whatever source the AI has used? Bonus points for being verified in some way?

Please @ me if you want to start that company. Could be fun. Lol.

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