Welcome to the forefront of conversational AI as we explore the fascinating world of AI chatbots in our dedicated blog series. Discover the latest advancements, applications, and strategies that propel the evolution of chatbot technology. From enhancing customer interactions to streamlining business processes, these articles delve into the innovative ways artificial intelligence is shaping the landscape of automated conversational agents. Whether you’re a business owner, developer, or simply intrigued by the future of interactive technology, join us on this journey to unravel the transformative power and endless possibilities of AI chatbots.
Last year, OpenAI unveiled an ambitious plan to let companies like Spotify Technology SA and Booking Holdings Inc. launch mini apps within ChatGPT, allowing users to access their services without leaving the chatbot. The move, reminiscent of Apple Inc.’s App Store debut, looked to be a key step toward OpenAI turning ChatGPT into an all-in-one platform.
Six months later, the initiative is off to a sluggish start, according to interviews with app makers. While there are now more than 300 app integrations available, they’re hidden away and the functionality has been limited by the partner companies, which are hesitant to hand off customer relationships and payments to OpenAI. Developers have also complained about a tedious app-approval process, a buggy coding system and a lack of usage data.
The lackluster debut adds to a growing list of product bets by OpenAI that haven’t yet paid off. The company said last week that it is discontinuing its Sora video generator, part of a push to streamline its offerings ahead of a possible IPO later this year. OpenAI is also working to fold its nascent browser into a single desktop app with its chatbot and coding tools. The browser, called Atlas, also had some early growing pains.
The ChatGPT app push has the potential to escalate a growing rivalry with Apple, steering consumers toward a new ecosystem for apps and services outside the App Store. Apple moved to rein that in last November, introducing a “mini apps” policy requiring so-called super apps to hand over a 15% cut of in-app purchases.
The third-party integrations will also be key to drawing in more users as OpenAI faces growing competition from Anthropic PBC and Alphabet Inc.’s Google. And it will bolster OpenAI’s eventual goal of integrating its software into consumer devices. (It is working with ex-Apple executive Jony Ive on a family of products after acquiring his hardware startup for nearly $6.5 billion last year.)
Stubhub Holdings Inc. and Booking don’t yet see ChatGPT apps as a big marketing driver. “It’s easier to discover listings on Booking.com,” Booking Chief Executive Officer Glenn Fogel said in an interview, adding that referral traffic from ChatGPT is still “small.” The company still “spends an enormous amount” on advertising with Google relative to what it spends on OpenAI’s chatbot, he said.
OpenAI said its app platform is central to its product strategy. “We’re still early in building this out, and we recognize there are areas where the developer experience needs to improve,” a spokesperson said, adding that the company is committed to making the platform “more reliable, more predictable and easier to build on over time.”
The mixed reception for OpenAI’s apps endeavor also throws cold water on some of Wall Street’s exuberance and fears around the technology. A long list of initial partners, including Figma Inc., Expedia Group Inc. and Target Corp., saw their stocks surge after the original announcement, as the tie-up offered a new way to acquire users in the age of AI rather than be disrupted by it.
Some consumer companies consider it necessary to work with AI chatbots because they see them as an emerging search channel, not unlike Google. But AI assistants aren’t the only places where consumers learn about a brand, and these chatbots are far from supplanting the search giant.
DoorDash Inc. has also found that no single partner integration, whether it’s the order button on ChatGPT, Google or Yelp Inc., “monopolizes customer attention,” according to a company spokesperson.
During recent earnings calls, executives from Airbnb Inc., Booking, Expedia, DoorDash and eBay Inc., highlighted what they characterize as superior payment systems, round-the-clock customer support, user verification and reviews as reasons for why they won’t be replaced by AI-driven tools.
AI models “do not currently have the capabilities to provide a better service,” said Jefferies analyst John Colantuoni. “This creates a chicken-or-the-egg dynamic,” where consumers won’t switch to AI unless the service is better or cheaper, and the companies have no incentive to empower a middleman.
Few apps offer a checkout option that doesn’t force users to leave OpenAI’s chatbot. In the case of Uber, users must start the experience with “@Uber” before telling the chatbot their pickup and dropoff points to see an estimated fare range. Riders can only complete the booking on Uber, where the whole process is faster. (Instacart, which was formerly led by OpenAI CEO of Applications Fidji Simo, is an exception and has deeper integration for payments.)
StubHub, the ticket reseller, allows ChatGPT users to search for concerts, events and seat availability based on preferences like budget or viewing angles. But it also requires them to visit the website to complete their purchase, or even just to zoom in on a seating map.
Customers aren’t yet using chatbots as a “primary way” to buy things, said StubHub President and Chief Product Officer Nayaab Islam, who cited consumer apprehension around sharing credit card details with AI assistants.
Still, he said it would be “imprudent” to not participate in chatbot apps given the billions of users they have. “Having more options is a great thing for a business like ours,” he said.
If consumers are uneasy about AI, they aren’t alone: A new report released this month by advertising technology company Criteo found that 55% of more than 6,000 consumers surveyed globally are “extra cautious about sharing payment information with AI.” Shoppers are experimenting with AI as an assistant, but “not yet surrendering control” to it, the firm said in its report.
Instead, the study found, 96% of shoppers who regularly use AI chatbots also use other channels along the way, such as social media, traditional search and retailer websites.
“The Floodgates Have Not Opened”
It’s not just consumers who have yet to fully embrace the ChatGPT app store. Developers have found the app development process frustrating.
Getting an app published to the app store has been a lengthy ordeal for some developers, said Hanh Nguyen, CEO at Fractal, a startup that makes tools for non-coders to build chatbot apps. She said some rejections have included “false signals” flagged by OpenAI’s AI-assisted review system, which required intervention from the company’s human support staff to resolve, she said.
OpenAI said it has been picking up the pace on approvals, citing both a streamlined process and developers addressing previously identified issues. The company greenlit nearly 70 apps last week, up from just three to five a day previously, according to Elliot Garreffa, who co-founded a third-party platform to track ChatGPT apps and test their performance. (OpenAI declined to disclose specific numbers.)
Some developers run into problems even after their apps are accepted. Because OpenAI defines chatbot prompts as private data, the programmers have found they receive “very limited” analytics on their app’s performance, leaving them “running quite blind” regarding user engagement, Garreffa said.
“A pain point that we’ve constantly been hearing from companies is, ‘I’ve got this app live, but I have no idea if it’s failing. I have no idea if it’s consistently working” or showing up for the right users, Garreffa added. Since the platform is new, there isn’t yet a proven method to influence how apps are discovered, unlike how iOS app developers can test different ways to boost their rankings.
Those concerns about discoverability could intensify now that OpenAI has begun including advertising within the chatbot, meaning partner apps could increasingly find themselves competing with sponsored content for user attention.
Meanwhile, developers are contending with bugs in the development tools that have made their jobs more difficult.
“An app in dev mode will break and we’ll have to be like ‘Oh, why is that?’ and then we’ll have to go inspect what they’re doing and figure out that they changed something before they announce it,” said Max Ockner, Fractal’s chief technology officer. OpenAI has kept a changelog of the apps framework, but the documentation has not caught up with bugs that users flag on its public developer forum.
“The floodgates have not opened yet,” said Ockner. “We’re still actually waiting for that moment.”
Lung writes for Bloomberg.
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