Alphabet shares dip while OpenAI unveils a new search engine called SearchGPT.

• OpenAI announced a prototype of its SearchGPT search engine on Thursday.
• The company aims to provide users with quick and accurate responses, backed by reliable sources.
• The AI-powered search engine could ramp up pressure on Google.

On Thursday, OpenAI unveiled a prototype of its own search engine, SearchGPT, which aims to provide users with "fast and timely answers with clear and relevant sources." The company plans to eventually integrate the tool, currently being tested with a small group of users, into its viral chatbot, ChatGPT.

OpenAI is testing a prototype to potentially take market share from Google in search by providing consumers with new ways to seek information online.

On Thursday, the Nasdaq slightly increased, while shares were trading approximately 2.5% lower.

In May, Google unveiled AI Overview, a major update to search, as per CEO Sundar Pichai, which presented a summary of answers to queries at the top of Google Search to a select audience.

Despite Google's efforts to develop AI Overview for over a year, public criticism intensified after users discovered that the AI feature produced nonsensical or inaccurate results, with no option to opt out.

GPT-4o mini, an offshoot of GPT-4o, the fastest and most powerful AI model launched by OpenAI last May, was announced as the new model by the company last Thursday.

Microsoft-backed OpenAI has been valued at over $80 billion by investors, and the company, founded in 2015, is under pressure to maintain its position in the generative AI market while also finding ways to generate revenue as it invests heavily in processors and infrastructure to develop and train its models.

OpenAI recently announced the appointment of two top executives, Sarah Friar and Kevin Weil, as well as a partnership with Apple that involves integrating ChatGPT-Siri.

As the significance of large language models grows in the tech industry and competition intensifies in the emerging generative artificial intelligence market, OpenAI is strengthening its executive team.

In addition to the new mini AI model and the SearchGPT prototype, OpenAI is striving to be a leader in "multimodality," which involves generating various forms of AI-generated media, such as text, images, audio, video, and search, all within a single tool: ChatGPT.

OpenAI Chief Operating Officer Brad Lightcap stated in an interview with CNBC that the world is multimodal, and humans process and engage with the world through various modalities such as sight, sound, and speech. As a result, text and code have always felt incomplete as the only interfaces to the power of these models and their capabilities.