BofA Discovers Sluggish Growth in ChatGPT App Downloads

While AI continues to capture attention in the technology industry, OpenAI’s ChatGPT is not currently positioned to challenge Google’s dominance as the search engine leader, as per a new analysis from Bank of America Securities.

Bank of America analyst Justin Post noted in a recent report that app downloads for ChatGPT and Microsoft Bing have experienced a decline in recent weeks, based on Sensor Tower data.

The report reveals that ChatGPT downloads on iPhones in the U.S. witnessed a 38% decline month over month in June. Similarly, Bing app downloads, which incorporate a ChatGPT-based chatbot in the U.S., also dropped by 38% in June.

The note cites SimilarWeb data, stating that Google’s search engine market share has marginally increased to over 92% on a year-over-year basis. On the other hand, Microsoft’s Bing, which utilizes OpenAI’s ChatGPT technology, observed a decline of 40 basis points, accounting for approximately 2.8% of the market.

The decrease in attention towards ChatGPT and other similar large language models (LLMs) draws attention to the investment risk faced by companies like Google and Microsoft. These companies have dedicated substantial resources into the belief that recent AI advancements could give rise to a next-generation search engine that surpasses the current leader. Furthermore, several tech giants, including Nvidia, have invested hundreds of millions in AI startups.

However, if the adoption of ChatGPT is already slowing down, it could suggest that the technology may not pose a significant threat to Google’s dominance in search. Consequently, companies might need to explore other applications for LLMs, such as new advertiser tools, as suggested by the analysts.

“As for Google’s stock, concerns regarding LLMs impacting Google search have shifted from market share risk to monetization risk. However, with search share remaining strong, Google may not feel immediate pressure to integrate LLM (chat) results into commercial queries,” mentioned Justin Post in the report.

The ChatGPT app was released in May and is currently only available for iPhones. Bank of America analysts anticipate that the forthcoming OpenAI app for Android could drive higher adoption.

In addition to the app and Bing search engine, users can also access the ChatGPT chatbot through its website. Bank of America analysts estimate that visits to ChatGPT decreased by approximately 11% on a monthly basis, reaching just over 51 million visitors per week, which accounts for only about 2% of Google’s estimated web traffic.