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<\/a><\/p>\n(Reuters) -Alphabet Inc shares fell as much as 4% on Monday following a report South Korea’s Samsung Electronics was considering replacing Google with Microsoft-owned Bing as the default search engine on its devices.<\/p>\n
The report, published by the New York Times over the weekend, underscores the growing challenges Google’s $162-billion-a-year search engine business face from Bing – a minor player that has risen in prominence recently after the integration of the artificial intelligence tech behind ChatGPT.<\/p>\n
Google’s reaction to the threat was “panic” as the company earns an estimated $3 billion in annual revenue from the Samsung contract, the report said, citing internal messages.<\/p>\n
Another $20 billion is tied to a similar Apple contract that will be up for renewal this year, the report added. <\/p>\n
In a response to Reuters, Google said it was working to bring new AI-powered features to Search without commenting on its association with Samsung. The South Korean consumer electronics major did not respond to a request for comment. <\/p>\n
Google has for decades dominated the search market with a share of over 80%, but Wall Street fears the company could be falling behind Microsoft in a fast-moving AI race.<\/p>\n
Parent firm Alphabet lost $100 billion in value on Feb. 8 after its new chatbot, Bard, shared inaccurate information in a promotional video and a company event failed to dazzle.<\/p>\n
On Monday, the stock fell to $104.90 and erased nearly $50 billion from Alphabet’s market capitalization. Microsoft, meanwhile, outperformed the broader market with a rise of 1%.<\/p>\n
“Investors worry Google has become a lazy monopolist in search and the developments of the last couple of months have served as a wake-up call,” Atlantic Equities analyst James Cordwell said. <\/p>\n
Cordwell added the potential costs tied to making Google Search more competitive than AI-powered Bing could also be a cause of concern. <\/p>\n
Alphabet shares ended 2.7% lower at $105.9 on Monday.<\/p>\n
(Reporting by Aditya Soni and Akash Sriram in Bengaluru; Additonal reporting by Yuvraj Malik; Editing by Shinjini Ganguli and Krishna Chandra Eluri)<\/p>\n
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