As the NY Times reported a couple of days ago, Google red-flagged ChatGPT and created a special AI unit to understand how to tackle that.
There are two threats right now when it comes to ChatGPT.
Indeed, many mostly look at the threat of the AI tool replacing most of Google’s features.
However, the first threat is about negative network effects!
For the last two decades, the improvements of Google have been quite linear, meaning the company had to figure out how to scale its technology to expand its index to the billion of pages of the web while making sure its ranking stayed relevant.
And yet, with the advent of ChatGPT, the risk is the mass of web pages on the web might grow exponentially, and this AI-generated wave is posing a real threat to Google’s ability to keep up.
I’ll explore this threat in the podcast episode at the end of the newsletter.
On the other hand, though, there is a positive side to ChatGPT.
The AI tool has shown such incredible capabilities that we know for sure that it might be able to supplant Google!
Back in June 2007, Steve Jobs announced the iPhone.
That was an incredible product.
Yet the real turning point came when in July 2008, on the same stage Steve Jobs announced the App Store!
That was the moment in which a business platform was created.
From the combination of the iPhone (hardware), iOS (operating system), and App Store (marketplace), we got the birth of a business platform that today is worth many trillion dollars!
Of course, there is much more to the story.
Apple’s ability to build this business platform was a combination of product and distribution (as I explained in the Apple business model analysis).
The business platform is one of the hardest types of businesses to build, and yet the most valuable, as it looks much more like an ecosystem than a company.
A business platform combines elements of closed/controlled touchpoints and open/distributed ones.
For years we’ve been looking at the next business platform, and yet that is come from an unexpected place: Artificial Intelligence!
Indeed, in the last five years, we’ve been looking at various major technologies that could shift the current paradigm. From voice search, blockchain, AR, and VR.
And yet, the business world is quite unpredictable.
2022 made one thing clear; it might turn out to be the year where AI becomes the next business platform. The way OpenAI released its latest products also shows us how things might evolve. Indeed, we might see the rise of three AI layers:
The foundational layer: might be comprised of general-purpose engines like GPT-3, DALL-E, StableDiffusion, and so on.
A middle layer: might be comprised of vertical engines (imagine here you find your AI lawyer, accountant, or HR assistant).
And the apps layer: which might see the rise of a plethora of smaller and much more specialized applications built on top of the middle layer.
For years neural networks got stuck!
Until 2012, Imagenet proved that they could work.
However, even there, pessimism around what neural networks could really achieve was dominant.
In 2018, OpenAI finally released GPT.
That was a turning point.
So much so that only a year later, OpenAI turned from a research lab into a for-profit organization, which partnered up with Microsoft.
Just a couple of weeks back, as OpenAI released ChatGPT, it left us speechless about its capabilities.
Read Next: History of OpenAI, AI Business Models, AI Economy.
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