Details Cookies
United Kingdom
Important margin product information

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs, FX or any of our other products work and whether you can afford to take the high risk of losing your money.

Cookie policy

This website uses cookies to offer you a better browsing experience by enabling, optimising and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy here and our privacy policy here

Game changers: Thoughts on ChatGPT Game changers: Thoughts on ChatGPT Game changers: Thoughts on ChatGPT

Game changers: Thoughts on ChatGPT

Peter Garnry

Head of Equity Strategy

Summary:  ChatGPT is an impressive technology and has fascinated many people with even the idea that it could become the new Internet or even be end of Google's search engine. We take a look at the ChatGPT technology and whether it is a real threat to Google given that Google's DeepMind is already coming up with their own competitor to ChatGPT.

What is ChatGPT and why has it become so popular?

Microsoft has recently invested $10bn in OpenAI, the company behind the hyped ChatGPT, and is keen to roll the technology out across its various product. Before we answer the question of whether OpenAI’s ChatGPT could be the end of Google as we know it we must explain some things about ChatGPT.

It is not revolutionary to produce a chatbot which can reply to questions from humans, and we already have AI technology integrated in many different applications – so what have made ChatGPT so popular in such a short time? It is one of the first AI technologies which is easy to understand and to interact with for the general public. The difference from other chatbots is ChatGPT’s ability to respond in a language which is difficult to distinguish from a chat with a real human being. And it is trained on a much larger dataset with massive computational power, making it far superior to other chatbots. The cost of offering such a service to the general public does however not come without cost which may also be one of the reasons why some of the earlier chatbots have not been presented to the general public. The estimated cost of running ChatGPT is around $100,000 per day with each word generated on ChatGPT estimated to cost $0.0003, so it’s not a cheap exercise for ChatGPT.

Will ChatGPT be the end of Google’s search engine?

Will ChatGPT become a replacement for Google – or even the internet as Microsoft’s CEO said on the Q4 2022 earnings conference call? ChatGPT is a machine learning model trained to generate text on a given input, where Google is a search engine designed to find information on the internet through relationships of links between websites. Whereas Google is able to find information which has been posted recently, ChatGPT needs to be re-trained on new data containing this information, which can be a computationally heavy process. It is illustrated with our interaction with the current version of ChatGPT, clearly demonstrating limitations in the input data:

Source: ChatGPT

From ChatGPT from Jan 25, 2023. Statement from us on top, answer below.

And a similar request using Google:

Source: Google

From Google, Jan 25 2023

What Google does which ChatGPT cannot/does not do:

  • Google provides search results based on real-time data
  • Google returns multiple answers which are fairly easy to navigate
  • Google clearly states the source, although neither Google nor ChatGPT has any validation of the content in the answer.
  • Google is extremely fast and cheaper compared to ChatGPT

Google’s DeepMind is racing towards their competitor to ChatGPT

DeepMind, which is a subsidiary of Alphabet (the parent company of Google) working on AI technology, and is one of the leading research groups within AI. Alphabet/Google has most likely been very frustrated by being outpaced by OpenAI on ChatGPT and demanded DeepMind to allocate ressources to come up with their own version. DeepMind recently announced an upcoming launch of their ChatGPT competitor called Sparrow which could be released for a “private beta” in 2023. Sparrow is expected to value factual accuracy higher, as well as having the ability to cite specific sources of information.

ChatGPT is has truly revolutionized many types of information queries and other types of tasks, but it remains very doubtful that it could be a replacement for Google, nor being a new phase of the internet. The fact that the technology is not patented and is being replicated by DeepMind, and maybe also Baidu in China, indicates that ChatGPT while impressive has succeeded in solving the engineering problems behind the technology. But if other technology companies can make their own versions the business value is less unique. In any case, Microsoft spent less than 1% on an option in AI technology.

Alphabet’s share price was down 44% from its peak to bottom, but this year its shares are up 12% following the rest of the technology sector. The ChatGPT and the narrative around it being the end of Google’s search business had a short-term meaningful impact on sentiment. But we believe the threat is overrated and that Google’s search business will continue to flourish in the years to come. Alphabet is valued at a free cash flow yield of 6% which is the yield observed since the financial crisis and underscores the low expectations that have been built into the stock price.

Alphabet share price | Source: Saxo


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (
- Full disclaimer (

Saxo Markets
40 Bank Street, 26th floor
E14 5DA
United Kingdom

Support Centre
For existing clients, please click here to request support via the Support Centre.

Have a question about our products, platforms or services? Visit the Support Centre to find answers for our most frequently asked questions. If you are still unable to locate an answer to your question, you will also find contact details for your local Saxo office to speak with a representative.

Contact Saxo

Select region

United Kingdom
United Kingdom

Trade Responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more
Additional Key Information Documents are available in our trading platform.

Saxo Markets is a registered Trading Name of Saxo Capital Markets UK Ltd (‘SCML’). SCML is authorised and regulated by the Financial Conduct Authority, Firm Reference Number 551422. Registered address: 26th Floor, 40 Bank Street, Canary Wharf, London E14 5DA. Company number 7413871.

This website, including the information and materials contained in it, are not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in the United States, Belgium or any other jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation.

It is important that you understand that with investments, your capital is at risk. Past performance is not a guide to future performance. It is your responsibility to ensure that you make an informed decision about whether or not to invest with us. If you are still unsure if investing is right for you, please seek independent advice. Saxo Markets assumes no liability for any loss sustained from trading in accordance with a recommendation.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. Android is a trademark of Google Inc.