Goodbye, Bard. Hello, Gemini: Google’s Game-Changing AI Model Takes on OpenAI’s ChatGPT
In the ever-evolving world of artificial intelligence (AI), there has been a changing of the guard. Google, a unit of Alphabet, has introduced its latest AI model, Gemini, to compete with OpenAI’s popular ChatGPT. But this isn’t just a simple renaming of their existing generative AI app. Google has gone a step further by replacing the underlying large language model (LLM) with its most powerful AI model to date.
Gemini comes in three sizes, each with its own unique capabilities. The first is Gemini Nano, which can run locally on devices. Next is Gemini Pro, which powers the free version of the app that was previously known as Bard. And finally, there’s Gemini Ultra, the largest model with the ability to handle highly complex tasks. In a head-to-head comparison with GPT-4, the LLM powering OpenAI’s advanced version of ChatGPT, Gemini Ultra came out on top in most benchmarks.
At first glance, it might have seemed like Google was falling behind in the AI race. OpenAI’s ChatGPT was dominating the market, and Microsoft, Google’s chief rival, was integrating OpenAI’s AI model throughout its product line. Google’s initial attempt with Bard didn’t go as planned and resulted in an embarrassing blunder. However, those familiar with Google’s AI expertise and resources knew better than to dismiss the company prematurely. Gemini is a testament to their capabilities.
Gemini Ultra’s impressive performance is evident in its ability to outperform GPT-4 on 30 out of 32 widely used benchmarks for LLMs. It even surpasses human experts on the massive multitask language understanding (MMLU) test, which covers a wide range of subjects from ethics and history to math and physics. Meanwhile, Gemini Pro compares favorably with GPT-3.5, the AI model powering the free version of ChatGPT.
Alphabet CEO Sundar Pichai hinted at the possibility of a subscription AI service during the company’s third-quarter earnings call in October 2023. And true to his word, Gemini Advantage, which utilizes the Ultra LLM, is now available through a monthly subscription of $19.99 in the U.S., with a free two-month trial period.
The question now is whether Gemini will have a significant financial impact on Alphabet. With revenue of nearly $283 billion last year, Alphabet would need to attract nearly 11.8 million subscribers to boost revenue by just 1%. While this may not happen overnight, the integration of Gemini with other Google apps such as Maps, Flights, and YouTube, and its upcoming integration with Gmail and productivity apps like Docs, Slides, and Sheets, sets the stage for future success.
The introduction of Gemini Ultra also bodes well for Google Cloud. While the platform’s growth has somewhat slowed down compared to Microsoft’s cloud growth, Gemini has the potential to give Google Cloud a much-needed boost.
So, does Google’s new AI app make Alphabet stock a no-brainer buy? The answer is nuanced. While the launch of Gemini alone may not make it a no-brainer, Alphabet remains an attractive stock to consider. Gemini showcases Google’s commitment to staying at the forefront of AI technology. And this is just the beginning, with even more powerful versions expected in the future.
AI is poised to provide a massive long-term tailwind for Alphabet, even if the company’s search model needs to adapt along the way. Considering its prospects over the next decade and beyond, Alphabet’s valuation is reasonable. As we welcome Gemini, we may also be welcoming a bright future for Google.
Disclaimer: Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Keith Speights has positions in Alphabet and Microsoft. The Motley Fool has positions in and recommends Alphabet and Microsoft. The Motley Fool recommends long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.