Microsoft (MSFT) a 'clear winner' of AI arms race given ChatGPT superiority - analyst

March 16, 2023 9:57 AM EDT
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Macquarie analyst Sarah Hindlian-Bowler reflected on the release of ChatGPT 4.0, which was unveiled on Tuesday by Microsoft-backed OpenAI.

The latest version of the AI chatbot reportedly offers vast improvements. Microsoft also announced that its Bing search engine has been running on an early version of ChatGPT 4.0 for several weeks.

“We view GPT-4 as the current industry standard to beat and, while generative AI is in a hype cycle, it is nevertheless quite real… We think GPT-4 sets the new standard for AI that other players like Google and Baidu will need to pace,” Hindlian-Bowler said in a client note.

The analyst believes Microsoft is emerging as a “clear winner” in the AI arms race given “its improvements to Bing, the size of the search market ($187bn) and Google's current dominance of 60% of global online ad spending and up to 90-95% of market share in most developed nations.”

Shares of China-based internet search giant Baidu (NASDAQ: BIDU) opened lower today after the company finally presented its ChatGPT-like chatbot, which generated mostly subdued reactions.

By Senad Karaahmetovic

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Senad Karaahmetovic