Microsoft To Arm Search Engine, Browser With Tech 'More Powerful' Than ChatGPT In Heated AI Battle With Google

Microsoft Corporation MSFT says it is launching new versions of the Bing search engine and Edge internet browser enhanced with artificial intelligence.

What Happened: The search engine and the browser are available for preview currently, according to a company statement issued Tuesday.

“AI will fundamentally change every software category, starting with the largest category of all – search,” said Satya Nadella, Chairman and CEO of Microsoft.

“Today, we’re launching Bing and Edge powered by AI copilot and chat, to help people get more from search and the web.”

The preview is available on a limited basis on desktops and Microsoft said it will be scaling it to “millions” in the coming weeks. The company said a mobile experience is on its way.

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Why It Matters: Microsoft said it has brought together search, browsing and chat into “one unified experience” in the latest move. 

The company said Bing is running on a “next generation” large language model made by OpenAI, "more powerful than ChatGPT” and customized specifically for search. 

The Redmond, Washington-based tech giant said it had developed a proprietary method of working with OpenAI’s model that helps it best to leverage its power called Prometheus.

The company has previously invested in OpenAI in 2019 and 2021 and doubled down on backing the AI startup last month.

Microsoft’s move comes in the backdrop of Google and Chrome’s dominance in search and browser segments respectively. Both products belong to Alphabet Inc GOOGL GOOG.

Google has intensified its own AI efforts and is working on project "Atlas" to respond to ChatGPT. The company has tested a chatbot called "Apprentice Bard."

Nadella said on Tuesday in an interview that the “most profitable large software business is Search.” He said that Google makes more money on Windows than all of Microsoft, which drove the company to “really go after this” opportunity. 

Price Action: On Tuesday, Microsoft shares rose 4.2% in the after-hours trading to $267.56 after closing 0.6% higher at $269.26, according to Benzinga Pro data.

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