Dear reader, artificial intelligence promises to transform nearly every industry in the years ahead. As a key leader in this AI revolution, ChatGPT has captured attention for its eloquent conversational abilities. However, as ChatGPT remains privately held within research firm OpenAI, direct investment access proves elusive.
Yet through strategic technology partnerships, several public companies offer intriguing exposure to ChatGPT‘s capabilities. By understanding their positioning alongside inherent risks, you can make informed decisions on participating in this high-potential arena. Let‘s explore.
Microsoft Bets on AI Ascendancy
ChatGPT springs from San Francisco-based OpenAI, the AI research organization backed by luminaries like Elon Musk and Reid Hoffman. To push new boundaries in AI, OpenAI depends on substantial computing resources. Cloud titan Microsoft grasped this symbiosis, forging a partnership with OpenAI in 2019 and investing $1 billion for minority ownership.
The goals? To enhance OpenAI‘s models while enabling Microsoft to embed OpenAI‘s innovations across its stack. Most imminently, Microsoft plans to incorporate core capabilities showcased by ChatGPT into the company‘s Bing search engine.
"The race starts today for us," said Microsoft CEO Satya Nadella, "and we have a structural position with Azure AI supercomputing as the preferred platform for most organizations."
By combining OpenAI‘s prowess in natural language processing with Bing‘s search functionalities and data trove, Microsoft envisions superior conversational search.
The market‘s substantial at around $80 billion annually, but Google thoroughly dominates, holding 84% share. If enhanced by AI, Bing could better compete – and Microsoft‘s stock may ascend higher.
Riding Alongside Bing
As Bing prepares its AI augmentation, Microsoft partner Perion Network potentially stands to gain.
Perion provides digital advertising and search monetization solutions, developing technology that surfaces product recommendations alongside search results. If Bing‘s AI upgrade allows it to nibble Google‘s share over time (perhaps 2-3% near term), it can unlock greater revenue for Perion.
Search Engine Market Share 2022
Google 84.1% $302B value
Bing 8.8% $28B value
Baidu 4.3%
Yahoo 2.0%
Yandex 0.8%Unlike pure speculation over direct equity in ChatGPT itself, Perion offers concrete exposure to Bing‘s prospective ascent – powered by OpenAI integration. Upside depends on Microsoft executing successfully, but Perion merits consideration as a derivative AI play.
Survey of the AI Landscape
Beyond Microsoft, multiple technology giants plow capital into AI across software, hardware and research. Familiar names lead these forays:
Alphabet – Parent of Google, with strengths in search, quantum computing and autonomous vehicles via Waymo subsidiary. Key focal areas span computer vision, robotics, generative language.
Nvidia – Produces leading GPU chips that provide specialized processing beneficial for machine learning tasks. Powers public cloud and enterprise AI infrastructure globally.
Amazon – Leverages AI across ecommerce marketplace optimization, supply chain logistics and voice-based consumer devices. Alexa system enables increasingly sophisticated voice interactions.
Meta/Facebook – Invests over $10 billion annually in R&D, with major initiatives around conversational systems (eg Messenger bot), computer vision for metaverse environments.
Exposure to these AI leaders allows diversification across components like hardware, software and research. Each directs massive resources in pursuing what they view as a new computing paradigm.
Judicious Evaluation of Risk
As with any emergent technology, uncertainties pervade even the most promising AI systems and applications today:
Volatility – Stock price fluctuations surge based on unpredictablebreakthroughs or delays in technical milestones. Models struggle incorporating rapid disruptive impact.
Talent Instability – Acute shortage of qualified AI researchers strains supply across academia and industry. Rising compensation costs and teams in flux.
Data Deficits – No model exceeds the limits of its training data. Shortfalls in diversity and breadth of inputs constrain real-world applicability.
Model Vulnerabilities – Susceptibility to adversarial attacks and bias issues plague many state-of-the-art models, impeding deployment.
Limited Transparency – Reliability and auditability remain sorely lacking for users of AI systems built on machine learning. Raises ethical flags.
By cataloguing these risk factors with pragmatic mitigation approaches, we can properly contextualize tremendous enthusiasm for AI’s potential.
Final Thoughts
ChatGPT kickstarted 2023 with captivating evidence of AI’s progress in language mastery. Yet absent a direct symbol, interested investors must get creative. Strategic alignments with OpenAI by Microsoft and Perion Network exhibit one path to gain exposure. More broadly, AI-focused leaders across software and hardware offer growth from increasing integration.
Approaching these opportunities with eyes wide open to downside risks allows us to make reasonable allocations to this technology megatrend. As AI capabilities advance, so too will clarity around leaders best enabling its responsible transformation of society and industry. Patience and diligence together equip us to navigate these fascinating times of acceleration ahead.
