Baidu shares fall after Ernie AI chatbot demo disappoints

PIcture of presentation
Enlarge / “Please use the sharing tools found via the share button at the top or side of Baidu,” chief Robin Li introduces the functions of the company’s AI chatbot Ernie in Beijing on Thursday. Li said there was high market demand as Chinese companies raced to develop an equivalent to Microsoft-backed ChatGPT.
Ng Han Guan/AP

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Shares of Baidu fell as much as 10 percent on Thursday after the web search company showed only a pre-recorded video of its AI chatbot Ernie in the first public release of China’s answer to ChatGPT.

The Beijing-based tech company has claimed Ernie will remake its business and for weeks talked up plans to incorporate generative artificial intelligence into its search engine and other products.

But on Thursday, millions of people tuning in to the event were left with little idea of whether Baidu’s chatbot could compete with ChatGPT.

During the highly publicized and eagerly anticipated news conference for Ernie, Baidu founder Robin Li stood beside an open chat screen, narrating questions that had earlier been typed into the chatbot. He admitted the company was only showing a demo of the technology that it had prepared earlier.

Li said some users would soon be able to test out Ernie on their own but did not provide a timeline for a full public rollout. The company is starting with a limited public release to business partners.

Ernie’s planned launch comes as US groups such as OpenAI and Google continue making strides in pushing forward their development of generative AI. OpenAI this week released GPT-4, its latest AI model that it claims can beat some humans on tough professional tests such as the US bar exam.

Microsoft is incorporating GPT-4 into Bing and other products, while US corporations are testing the technology in their workplaces and products.

Nearly every Chinese tech giant is racing to roll out a domestic version of ChatGPT, with analysts saying they believed Baidu’s years of investment in AI and development of natural language learning technology had given the group an early lead.

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