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ChatGPT is gaining on Google in the lucrative online search market, according to new data released this week.
In a recent survey of 1,000 people, OpenAI's chatbot was the top search provider for 5% of respondents, up from 1% in June, according to brokerage firm Evercore ISI.
Millennials drove the most adoption, the firm added in a research note sent to investors.
Google still dominates the search market, but its share slipped. According to the survey results, 78% of respondents said their first choice was Google, down from 80% in June.
A few percentage points may not seem like much, but controlling how people access the world's online information is a big deal. It's what fuels Google's ads business, which produces the bulk of its revenue and huge profits. Microsoft Bing only has 4% of the search market, per the Evercore report, yet it generates billions of dollars in revenue each year.
ChatGPT's gains, however slight, are another sign that Google's status as the internet's gatekeeper may be under threat from generative AI. This new technology is changing how millions of people access digital information, sparking a rare debate about the sustainability of Google's search dominance.
OpenAI launched a full search feature for ChatGPT at the end of October. It's also got a deal with Apple this year that puts ChatGPT in a prominent position on many iPhones. Both moves are a direct challenge to Google. (Axel Springer, the owner of Business Insider, has a commercial relationship with OpenAI).
When the Evercore analysts drilled down on the "usefulness" of Google's AI tools, ChatGPT, and Copilot, Microsoft's consumer AI helper, across 10 different scenarios, they found intriguing results.
There were a few situations where ChatGPT beat Google on satisfaction by a pretty wide margin: people learning specific skills or tasks, wanting help with writing and coding, and looking to be more productive at work.
It even had a 4% lead in a category that suggests Google shouldn't sleep too easy: people researching products and pricing online.
Still, Google remains far ahead, and there were positive findings for the internet giant from Evercore's latest survey.
Earlier this year, Google released Gemini, a ChatGPT-like helper, and rolled out AI Overviews, a feature that uses generative AI to summarize many search results. In the Evercore survey, 71% of Google users said these tools were more effective than the previous search experience.
In another survey finding, among people using tools like ChatGPT and Gemini, 53% said they're searching more. That helps Google as well as OpenAI.
What's more, the tech giant's dominance hasn't dipped when it comes to commercial searches: people looking to buy stuff like iPhones and insurance. This suggests Google's market share slippage is probably more about queries for general information, meaning Google's revenue growth from search is probably safe for now.
So in terms of gobbling up more search revenue, ChatGPT has its work cut out.
Evercore analyst Mark Mahaney told BI that even a 1% share of the search market is worth roughly $2 billion a year in revenue. But that only works if you can make money from search queries as well as Google does.
"That's 1% share of commercial searches and assuming you can monetize as well as Google — and the latter is highly unlikely in the near or medium term," he said.
