Editor’s note: Today, we bring you a guest piece by Sam Volkering from his publication AI Collision which was first published on Tuesday 29 October.
You can hear from Sam more often at AI Collision and learn more about the latest developments in AI by simply clicking here to sign up for free.
Welcome to AI Collision 💥,
In today’s collision between AI and our world:
- MSN to Live to ChatGPT
- CHIPS Act in the bin
- Trump vs Harris, who wins?
If that’s enough to get the pirates sailing, read on…
AI Collision 💥
Have you noticed anything different about Google search recently?
Try “Google searching” for “help me plan a trip to France”.
No longer does a SEO-enriched website pop up or a “Sponsored” post hit the top of your results list.
Instead, you get an “AI Overview” which is Google’s Gemini AI giving you some useful tips and pointers, along with some relevant links.
Of course, Gemini’s “AI Overview” doesn’t kick in for every question you might have.
Such as:
Funny that.
Anyway, the reason I bring this up is that clearly Google is going to do more of this. It was a world leader in the development of large language models and the integration of machine learning and AI into its company.
But it’s OpenAI (and by proxy, Microsoft) that is fast creeping up on the search engine giant and may finally be on track to surge past Google.
Microsoft has a chequered history with search.
Its first foray into search was with MSN Search back in the late 90s. But as Google launched around the same time, MSN Search never really got the same kind of growing traction that Google did.
It was catch-up from there. There was the launch of the “Windows Live” software, including MSN Search becoming Windows Live Search, but it again didn’t make a dent on Google’s growth.
Then in 2009 came Bing. It was a big bet that never paid off. It’s said Microsoft spent over $100 billion on Bing over the years and tried to get Apple to adopt it as its default search in 2009, 2013, 2015, 2016, 2018 and 2020.
Apple said no every time.
Bing never got close to Google.
Google still has around 92% market share of search, with Bing making up around 3% and then a handful of others – Yahoo, Firefox, Brave, etc – making up the numbers.
But maybe, just maybe, Microsoft’s best play at dominating search is finally here… just not technically through Microsoft.
As I pointed out last week, OpenAI has just dropped ChatGPT web search into the wild. It’s good, very good. So good in fact that I think if Microsoft (via OpenAI) were to go back to Apple again, I think this time Apple would say yes!
Of course, this may also be a precursor to the end of search as we know it. Are we really looking for websites anymore? Or are we looking for solutions when we’re looking for things online?
For example, I was just recently buying a trampoline for my boys. I was on the Decathlon app, then a big box retailer website, and then I was browsing through hundreds of different models, and colours, and additions, and I spent hours trying to find a “10 foot trampoline with mini basketball ring that’s got a safety net and is the best price online”.
Had any AI been able to find and buy that for me, then you’d have me for life.
That is ultimately where search is heading. To provide us with answers to questions, solutions to problems and to make everything we do online more efficient.
My take is that right now, Google doesn’t do that as well as OpenAI is doing with ChatGPT search, and if Microsoft has its hand heavily involved, then finally (or at least within this decade) maybe it will be Microsoft getting its long-awaited search victory!
AI gone wild 🤪
0.37%.
That is the percentage of actual funds that has been finalised from the Biden administration’s CHIPS Act.
Of the $33 billion announced for funding and grants under the act, only $123 million has actually been finalised to Polar Semiconductor in Minnesota.
Source: Politico
There’s a lot of proposed money: $6.6 billion for TSMC in Arizona, $3.2 billion for Samsung Electronics in Texas, $3.1 billion for Micron in New York. Then there are awards for other companies around the country including SK Hynix, Wolfspeed, Hemlock Semiconductor, Texas Instruments, Intel… The list goes on.
But these are all proposed still, only 0.37% are actually finalised.
Which now leaves the question that if there’s a change of government in a couple of days’ time, will any of that money see the light of day?
There’s talk of the Republicans repealing the CHIPS Act. If they did, the expectation would be another act, with similar kinds of funding… or something more aggressive in the form of harder tariffs on products to more or less strong-arm industry to build in the US or face the economic consequences.
It’s the proverbial dangling carrot vs. the whip across the hind.
Trump knows the biggest market for these companies is China and the US. It’s hard to see them bailing on the US market because it would simply be stock-price suicide.
Conversely, if they build in the US without the financial incentives of the CHIPS Act, is that also going to mean the semiconductor companies – many of which we’ve covered here in recent months – takes a direct hit to the torso?
I think it’s fair to say that volatility is about to ramp up this week. Of course, Trump could lose – and the polls have quickly been trending in Harris’ favour over the weekend – and the CHIPS Act may survive.
What is for sure though is that cashed up AI-hungry Big Tech that doesn’t need to rely on government incentives will keep driving the AI stock market forward. And if volatility makes them all a bit cheaper as the market gets the wobbles, it might be a prime buying time for the long-term investor.
Boomers & Busters 💰
AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week.) [Figures correct at time of writing.]
Boom 📈
- iRobot (NASDAQ:IRBT) up 16%
- Amazon (NASADQ:AMZN) up 6%
- Alphabet (NASDAQ:GOOG) up 4%
Bust 📉
- Predictive Oncology (NASDAQ:POAI) down 16%
- Kainos Group (LSE:KNOS) down 10%
- AMD (NASDAQ:AMD) down 9%
From the hive mind 🧠
- AI that can make AI. I’m pretty sure that’s the core premise of how “the machines” take over in The Terminator, right? Well, as much as I don’t want that to happen, this might be the start of it in real life.
- Disney might just be a late entrant into the “cool uses for AI” competition. While the company’s streaming service isn’t exactly firing on all cylinders, and neither are its theme parks, the idea of being an AI in the arts leader is something that may rejuvenate the company.
- Keep a note of this – while there’s a lot of attention and capital being aimed at AI, don’t neglect the importance and development of quantum computing. It’s fallen a bit to the wayside recently, but it’s arguably as important to AI and maybe even more important to our world than many people might think.
Artificial Polltelligence 🗳️
Well, it looks like the majority of you and I share something in common: our view of short-sellers in the market. The thing that really annoys me more than anything is when they take a short position before publishing their scathing reports on companies.
While some criticisms are fair, it does feel like that’s just not a fair way to operate in the market. But I’m no regulator so…
Anyway, here’s what you said to our poll last week.
Weirdest AI image of the day
They can’t take away our marshmallows! – r/weirddalle
ChatGPT’s random quote of the day
“If you don’t fail at least 90 percent of the time, you’re not aiming high enough.”
– Alan Kay
Thanks for reading, see you next time!
Sam Volkering
Editor-in-Chief, AI Collision
PS If you’d like to know more about how to invest in AI – I have just the thing and it’s close to home. I believe one small Cambridge company could become the first £1 TRILLION British company, in the next five years. The biggest players in tech – Apple, Microsoft, and Tesla – are all rushing to get their hands on this company’s products. Find out more by watching my latest presentation.
Capital at risk. Forecasts are not a reliable indicator of future results.
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