Google's New Generative AI Search, UK Interest Rates, and Palantir's Earnings. Newsletter #21
Google's New Generative AI Search, UK Interest Rates, and Palantir's Earnings. Newsletter #21
Google’s Generative AI-Search Integration
UK Interest Rates Rise Again
Palantir’s Earnings Surprise
Is AI Destroying Journalism?
US Debt Default
Google’s Generative AI-Search Integration
Google laid out its plans for using generative AI in search last week in an article titled “Supercharging Search with Generative AI”.
They believe they’ll be able to take more of the work out of searching so you can understand a topic faster and get more insights into it whilst also get things done quicker.
“With new breakthroughs in generative AI, we’re again reimagining what a search engine can do.”
In a more in-depth PDF released by the company, they say they’re experimenting with what’s possible through a new Search Labs program. The first experiment is Search Generative Experience (SGE) which according to Google is “an early step in transforming the search experience with generative AI.”
SGE will feature AI-powered snapshots, a more conversational form of search, and (unsurprisingly) search ads. Google also says they’re rolling the feature out thoughtfully and in accordance with their AI Principles.
Priority access to SGE will be rolled out to Google One subscribers in the coming weeks but there’s no word at the moment on when it will be available to the wider public.
UK Interest Rates Rise Again
The Bank of England (BoE) raised interest rates by 0.25% last Thursday to 4.5%, the highest level since 2008.
The bank’s Monetary Policy Committee said the rise was needed to bring inflation back under control. The rise is the 12th quarterly consecutive hike.
The committee still believes inflation will settle close to its 2% target if interest rates follow the path they’re aiming for, but that this might not happen until 2025.
The BoE now expects inflation to fall from the current level of 10.1% to 5.1% in the fourth quarter of 2023, instead of its previous forecast of 3.9%. And said that it wouldn’t hesitate to raise rates further if inflation proves to be more persistent than expected.
The BoE thinks food price rises will no longer be driving headline inflation in a year’s time. However, it expects the general improvement in the economy will mean that inflation will stay above the BoE’s target for longer than expected.
Palantir’s Earnings Surprise
Data analysis company, Palantir, reported its earnings for the first quarter of the year last week and beat analyst estimates for both revenue and earnings.
The company also said it expects to be profitable in every quarter for the rest of 2023. Shares rose 28% after the announcement.
Earnings per share: $0.05 vs $0.04 expected.
Revenue: $525 million vs $506 million expected. 18% growth year on year.
This marks the company’s second ever quarter of positive net income, the first was Q4 of 2022.
Palantir is widely known for its close ties to the US government and it said its US commercial customer count grew 50% year over year, from 103 customers to 155.
CEO, Alexander Karp, made it clear that Palantir’s AI products were developed with human involvement and oversight in mind. Its AI will not be capable of carrying out operations in a military context without a human supervisor.
The machine must remain subordinate to its creator - Palantir CEO, Alex Karp.
He also said demand for its new AI platform, which allows clients to use large language models based on their own private data sets is “without precedent”.
Is AI Destroying Journalism?
Media mogul, Barry Diller, warned that AI could be as destructive to news publishers as free online news was in the early 2010s.
Diller, who cofounded Fox and is now chairman of publishing giant IAC said that he’s teaming up with some other leading media moguls to protect news publishers from AI.
Large language models like ChatGPT allow users to access to any information that came from news archives without paying the companies that produced it. When asked about this ability, Diller said “You can’t have fair use when there is an unfair machine that knows no bounds”. He is just one voice amongst many in the media business who see AI as an existential threat.
Diller explained that IAC is leading a group to bring changes to copyright law and threaten litigation against publishers who take their content without permission, this could include OpenAI.
AI seemingly brings great risks and opportunities to those involved in journalism. It could make independent journalism better than ever before or simply replace it altogether. How it will play out will be seen in the next five years.
US Debt Default
The US is facing another debt default crisis with the government potentially running out of money within weeks unless it can find a solution quickly.
Some are predicting global chaos in financial markets if Congress can’t agree on a deal to raise the debt ceiling - a law that limits the total amount of money the government can borrow to pay its bills. It currently stands at $31.4 trillion.
Thankfully, it looks like the early stages of an agreement are emerging between Democrats and Republicans. Republicans want deep cuts to public services over ten years whilst Democrats want more modest cuts over two years.
Even so, some Republicans still seem downbeat about the potential for an agreement and say the Democrats are moving too slowly. Democrats however don’t want to sacrifice any of the policies they passed in the last two years and nor o they want to implement a level of austerity that could stunt the US economy before the election next year.
Businesses are closely following the talks as corporate America becomes increasingly alarmed at the prospect of default and pushes for a deal. Some corporate leaders insist it remains within reach.
