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The rapid rise of ChatGPT, a chatbot launched by OpenAI, proves that Google‘s dominance in Internet search and online advertising is under constant threat from emerging competitors. As a result, it could help Google make the case that it isn’t a monopoly in defending itself against a second DOJ antitrust battle, which seeks to break up the company.
ChatGPT has yet to develop a business model to monetize the strong demand for its services, but it could soon come up with a subscription plan, an ad-supported plan, or a combination of both. And that could pose a serious threat to Google’s business model and the monetization of its competitive advantage.
“Google will certainly use ChatGPT as an example that its core search business is always under threat, especially since ChatGPT is backed by billions in investment from Microsoft,” Arun Sundararajan, the Harold Price Professor of Entrepreneurship and Professor of Technology, Operations and Statistics, New York University’s Stern School of Business, told International Business Times.
That’s how the AI-assisted search engine could turn from a curse to a blessing for Google.
The DOJ’s challenge to Google’s market dominance has been around for a while. It began back in 2020 under a changing of the DOJ guard under newly elected President Joe Biden. “However, the issue of monopoly is going to be thrown into the spotlight now that Republicans have taken over the House,” said Baruch Labunski, CEO of Rank Secure.
Labunski sees the big tech’s breaking up on their agenda at a critical time for the industry.
“Google and the tech industry will be forced to change a good bit over the next few years either by law or by capitalism,” he said. “More browsers are popping up that don’t manipulate searches, and the number of users has dropped on many platforms, opting for more conservative spaces.
“Ad revenue has dropped too, and will follow the crowd over time. That will force the tech companies to re-evaluate how they are doing things. All you have to do is look at Twitter to see the changes that can happen with any big tech companies.”
Regarding ChatGPT, Labunski thinks it is a worthy competitor that Google has never had to face before, but it doesn’t prove that it isn’t a monopoly. “The definition of being a monopoly isn’t geared to just search engines,” he added. “The legal definition is that a monopoly controls the market in an industry where the public doesn’t have a choice in using them.”
To strengthen this argument, Labunski looks at Google parent company Alphabet’s portfolio of companies in the information or intelligence industry. It includes YouTube, Fitbit, and WAZE, for example, giving Alphabet control of the majority of information an average person receives.
“That means it can control the type of information and what information people are given without valued competition to state otherwise,” he added. “That is a monopoly.”
However, Sundararajan sees the DOJ disregarding Google’s claim that ChatGPT is a serious competitive threat to its market dominance.
“Although ChatGPT’s conversation agent signals a completely new way of fulfilling our search needs, the DOJ is likely to argue that it will be many years before ChatGPT puts a dent in Google’s business,” he explained. “And Google has its competing technology — BERT, which may be better suited to search-like requests than ChatGPTs underlying GPT-3 technology.”
Editor’s Note: The writer owns shares of Alphabet
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