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Baidu cancels presentation of ChatGPT competitor, stock prices drop

On Monday, Baidu Inc, a Chinese internet company, canceled a planned livestream for the launch of its AI-driven chatbot, “Ernie bot,” which was intended to compete with OpenAI’s ChatGPT. Instead, the company opted for closed-door meetings with companies testing the product, resulting in a drop in its Hong Kong shares. Baidu stated that it had canceled the webcast due to “strong demand” from 120,000 companies that had lined up to test the Ernie bot, and that it will hold multiple closed-door meetings to test the bot.

As a result of the cancellation, Baidu’s Hong Kong shares (HK:9888) fell as much as 5% and were down 3.1% at HK$149.60 when trading resumed after the midday break. The broader Hang Seng index was down 0.9%.

Ernie bot had a limited launch earlier this month, which received a mixed reaction from investors. Following the launch, Baidu’s shares initially plummeted after the pre-recorded session with CEO Robin Li. However, positive feedback from research firms that tested the bot triggered a delayed rally in Baidu’s shares.

Some analysts believe that China’s attempts to create an AI similar to ChatGPT will be hindered by the country’s strict internet controls, which limit the amount of information available to chatbots. Nevertheless, the Chinese government has outlined plans to support AI development, with Baidu’s regional rivals, including Alibaba Group Holding Ltd (HK:9988), Tencent Holdings Ltd (HK:0700), and Huawei, all working on their own versions of the technology.

Baidu had revealed plans for an AI-driven chatbot earlier this year, following the launch of OpenAI’s ChatGPT, which sparked interest in generative AIs. OpenAI, which is primarily backed by Microsoft Corporation (NASDAQ:MSFT), intends to refine and incorporate the technology into its suite of office software.

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