
<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>Shares of Google parent firm Alphabet fell 3% to a 2024 low on Thursday, after OpenAI launched a test version of SearchGPT, a new artificial intelligence-powered search engine to be implemented into ChatGPT that could enter OpenAI into an internet search market dominated by Google.</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>SearchGPT, a new search engine created with OpenAI’s AI models, launched as a temporary “prototype” among a small group of users—<a href="https://www.theverge.com/2024/7/25/24205701/openai-searchgpt-ai-search-engine-google-perplexity-rival" rel="noreferrer noopener" target="_blank">reportedly</a>&nbsp;including about 10,000 people—and publishers, the company&nbsp;<a href="https://www.theverge.com/2024/7/25/24205701/openai-searchgpt-ai-search-engine-google-perplexity-rival" rel="noreferrer noopener" target="_blank">said</a>.</p>



<p>Alphabet shares fell to a new 52-week low of $167.32 as trading closed on Thursday.</p>



<p>SearchGPT summarizes information from websites and then provides short descriptions with an attribution link instead of linking directly to a website, and allows users to ask follow-up questions or open other relevant links in a sidebar.</p>



<p>In one example, searching for musical festivals in Boone, North Carolina, in August results in a list of each festival and a short description, followed by a link to a website for that festival, with a sidebar with links to other relevant results like event scheduling or ticket sales.</p>



<p>Publishers will be able to “manage how they appear” in search results, according to OpenAI, noting publishers can opt out of having their content used to train OpenAI’s models while still appearing in searches.</p>



<p>OpenAI said it plans to “integrate the best of these features” into ChatGPT in the future, though the company didn’t specify which features would be included.</p>



<h2 class="wp-block-heading" id="h-what-we-don-t-know">WHAT WE DON’T KNOW</h2>



<p>It’s not immediately clear how long the testing period will last and when SearchGPT will become more widely available.</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>There has been speculation on a new search engine from OpenAI this year, as the company moves to compete with Google in the search market. Bloomberg&nbsp;<a href="https://www.bloomberg.com/news/articles/2024-05-07/openai-is-readying-an-ai-search-product-to-rival-google-perplexity" rel="noreferrer noopener" target="_blank">reported</a>&nbsp;in May—citing a person familiar with the matter—that OpenAI was developing a new search feature for ChatGPT intended to compete with Google and the AI search startup Perplexity. At the time, OpenAI was “aggressively trying to poach Google employees” to develop the product,&nbsp;<a href="https://www.theverge.com/2024/5/7/24151616/openai-is-entering-the-search-game" rel="noreferrer noopener" target="_blank">according</a>&nbsp;to The Verge. OpenAI was&nbsp;<a href="https://www.reuters.com/technology/openai-plans-announce-google-search-competitor-monday-sources-say-2024-05-09/" rel="noreferrer noopener" target="_blank">reportedly</a>&nbsp;planning the new search engine in May, before Google announced plans for its Gemini AI products at the company’s annual developer conference. OpenAI has partnered with several publishers over the last year, including the Associated Press, the Financial Times, The Wall Street Journal parent News Corp, and Politico and Business Insider’s parent company Axel Springer, among others. The partnerships allow OpenAI to use content by each publisher to help answer user queries and train the company’s AI models.</p>



<h2 class="wp-block-heading" id="h-tangent">TANGENT</h2>



<p>The New York Times <a href="https://www.forbes.com/sites/britneynguyen/2023/12/27/new-york-times-sues-openai-and-microsoft-billions-owed-for-ai-copyright-infringement-case-claims/">filed</a> a lawsuit against OpenAI and Microsoft in December alleging “unlawful use” of millions of copyrighted articles by the publisher being used to train AI models. The Times alleges OpenAI and Microsoft’s technology that powers ChatGPT and Bing Chat, now called Copilot, could “Generate output that recites Times content verbatim, closely summarizes it and mimics its expressive style.” OpenAI filed a <a href="https://static01.nyt.com/newsgraphics/documenttools/82a013b9ba852548/9d4b1790-full.pdf" target="_blank" rel="noreferrer noopener">motion</a> to dismiss parts of the complaint, suggesting users did not use ChatGPT or other products from the company as a “substitute” for a subscription to the Times. The lawsuit is ongoing.</p>


In this photo illustration a Open AI logo is displayed on a

OpenAI Announces AI-Powered Search Engine That Could Challenge Google—And Alphabet’s Stock Drops 3%. Here’s What To Know.


<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



<p>OpenAI inked a deal with venture capital firm Thrive Capital that boosted its valuation to $80 billion or more, the&nbsp;<a href="https://www.nytimes.com/2024/02/16/technology/openai-artificial-intelligence-deal-valuation.html?smid=tw-nytimes&amp;smtyp=cur" target="_blank" rel="noreferrer noopener">New York Times</a>&nbsp;reported, a nearly threefold increase in value from just nine months ago.</p>



<h2 class="wp-block-heading" id="h-key-facts">KEY FACTS</h2>



<p>OpenAI will engage in an existing share sale under the “so-called tender offer” led by Thrive, the Times reported, citing unnamed sources with knowledge of the deal, noting the deal would allow employees to cash out their shares in the artificial intelligence company.</p>



<p>The deal comes nearly 10 months after OpenAI closed a $300 million share sale, marking it at a valuation of about&nbsp;<a href="https://techcrunch.com/2023/04/28/openai-funding-valuation-chatgpt/" target="_blank" rel="noreferrer noopener">$27 billion</a>.</p>



<p>An $80 billion valuation would rank the company as the No. 3 highest-valued tech startup in the world behind TikTok parent company ByteDance ($225 billion) and the Elon Musk-led SpaceX ($150 billion), according to&nbsp;<a href="https://www.cbinsights.com/research-unicorn-companies" target="_blank" rel="noreferrer noopener">CB Insights data</a>&nbsp;cited by the Times.</p>



<p>Talks surrounding a new deal were reported last year, when a share sale that would have reportedly valued OpenAI at up to $90 billion was being discussed, according to the&nbsp;<a href="https://www.wsj.com/tech/ai/openai-seeks-new-valuation-of-up-to-90-billion-in-sale-of-existing-shares-ed6229e0?mod=e2tw" target="_blank" rel="noreferrer noopener">Wall Street Journal</a>.</p>



<p>OpenAI and Thrive Capital didn’t immediately respond to Forbes’ requests for comment.</p>



<h2 class="wp-block-heading" id="h-key-background">KEY BACKGROUND</h2>



<p>OpenAI was founded in 2015 and received several large investments from multiple tech companies and investors in and by the end of 2023. Microsoft has invested a total of $13 billion in OpenAI, though the tech giant has said it doesn’t own any portion of OpenAI and is instead “<a href="https://www.bloomberg.com/news/articles/2023-12-08/microsoft-s-answer-to-openai-inquiry-it-doesn-t-own-a-stake" target="_blank" rel="noreferrer noopener">entitled to a share</a>&nbsp;of profit distributions.” Last April, Thrive, Sequoia Capital, Andreessen Horowitz and K2 Global agreed to acquire new shares in OpenAI, bringing its valuation to around $27 billion. OpenAI CEO Sam Altman, who was ousted from the company last year and promptly brought back after<a href="https://www.forbes.com/sites/siladityaray/2023/11/22/sam-altman-agrees-to-return-as-openai-ceo/?sh=7821de9c8a96">&nbsp;internal uproar</a>, has said the company has no intentions to&nbsp;<a href="https://www.reuters.com/technology/openai-ceo-has-no-ipo-plan-due-strange-company-structure-2023-06-06/" target="_blank" rel="noreferrer noopener">go public</a>&nbsp;in the near future.</p>



<p>Forbes Daily: Get our best stories, exclusive reporting and essential analysis of the day’s news in your inbox every weekday.Sign Up</p>



<p>By signing up, you accept and agree to our&nbsp;<a href="https://www.forbes.com/terms-and-conditions" target="_blank" rel="noreferrer noopener">Terms of Service</a>&nbsp;(including the class action waiver and arbitration provisions), and you acknowledge our&nbsp;<a href="https://www.forbes.com/privacy" target="_blank" rel="noreferrer noopener">Privacy Statement</a>.</p>



<h2 class="wp-block-heading" id="h-news-peg">NEWS PEG</h2>



<p>OpenAI on Thursday unveiled&nbsp;<a href="https://www.forbes.com/sites/antoniopequenoiv/2024/02/15/openai-reveals-sora-ai-video-model-capable-of-realistic-text-to-video-prompts/?sh=5206de69d361">its newest product, Sora</a>, which is able to generate videos from text prompts. The video service is not available to the public and it is unclear when it could be, as OpenAI said it is still going through “several important safety steps”&nbsp;<a href="https://www.forbes.com/sites/roberthart/2024/02/16/openais-sora-has-rivals-in-the-works-including-from-google-and-meta/?sh=3f0911822843">to combat potential issues</a>&nbsp;related to misinformation and bias.</p>



<h2 class="wp-block-heading" id="h-further-reading">FURTHER READING</h2>



<p><a href="https://www.nytimes.com/2024/02/16/technology/openai-artificial-intelligence-deal-valuation.html" target="_blank" rel="noreferrer noopener">OpenAI Completes Deal That Values the Company at $80 Billion</a>&nbsp;(NYT)</p>



<p><a href="https://techcrunch.com/2023/04/28/openai-funding-valuation-chatgpt/" target="_blank" rel="noreferrer noopener">OpenAI closes $300M share sale at $27B-29B valuation </a>(TechCrunch)</p>


Tag: Open AI

FORBES AFRICA SOCIAL MEDIA

OpenAI Announces AI-Powered Search Engine That Could Challenge Google—And Alphabet’s Stock Drops 3%. Here’s What To Know.

OpenAI Reaches $80 Billion Valuation In Venture Firm Deal, Report Says