OK, Google? Cathie Wood doesn't think so.

The Ark Invest CEO spoke at Fortune's Most Powerful Next Gen conference last week. And she argued that Alphabet's (GOOG 0.74%) (GOOGL 0.55%) could be in trouble. Why? The rise of OpenAI's ChatGPT. 

Google Search in the lurch

Wood stated at the Fortune conference,

I've never liked Google Search. You have to prompt it in a certain kind of way. ChatGPT is much easier. And I think it really is going to cause a lot of problems for Google.

She's not the only one with that view. Several technology industry observers have expressed concerns that Google's longtime dominance in search could be threatened by the launch of OpenAI's generative AI application.

Those worries especially mushroomed after Microsoft (MSFT 0.37%) announced that it was investing more in OpenAI and integrating ChatGPT with its Bing search engine. This integration was only one part of a larger strategy incorporating ChatGPT throughout Microsoft's suite of products.

Even Google executives seemed to be jolted by OpenAI's launch of ChatGPT. The New York Times reported in December 2022 that Alphabet CEO Sundar Pichai declared a "code red" emergency for Google to mount a response to the popular chatbot.

False alarms?

There's one big problem with the prediction made by Wood and others about the threat to Google from ChatGPT: That threat could be way overblown.

Investors certainly seem to have brushed any concerns aside. Alphabet stock has soared over 40% in 2023 despite the rise of ChatGPT. That's an even stronger performance than Microsoft has delivered. In the battle of the two AI stocks, Google is winning so far.

Wood's comments about the challenge presented to Google Search by ChatGPT also appear to be somewhat contradictory. She criticized Google Search because "you have to prompt it in a certain kind of way." But that criticism applies even more true to ChatGPT and other chatbots. Wood herself proclaimed that with generative AI, everyone will become a "prompt engineer."

There's more. Google Search's market share has actually increased since the introduction of ChatGPT, according to Statcounter GlobalStats. Meanwhile, Bing's market share has fallen since its integration with ChatGPT rolled out. 

What about dire forecasts that Bing could replace Google Search as the default search engine for major smartphone manufacturers? Nothing has materialized on that front, either. The Wall Street Journal recently reported that Samsung opted to stick with Google after briefly flirting with switching to Bing.

Even the "code red" allegedly declared by Google executives apparently wasn't the emergency some made it out to be. When Pichai was asked about it in a New York Times' podcast on March 31, laughed and replied that he never issued a code red. He acknowledged, though, that he has asked Google's teams to move with urgency to deploy large language models (LLMs) and that others in the organization might have used the phrase "code red" in emails.

More to the story

The reality is that Google has been a longtime leader in developing large language models that are the key to generative AI. The company even came up with the "T" in GPT (generalized pre-trained transformer). 

Google quickly launched its own generative AI solutions. And it has continued to iteratively improve on those solutions, for example debuting its PaLM 2 next-generation language model that debuted earlier this month. PaLM 2 is being incorporated into 25 products right out of the gate, including Google WorkSpace and Google's ChatGPT rival, Bard.

Pichai confirmed in Alphabet's first-quarter conference call that the company plans to integrate LLM "more natively into Search." He thinks that this integration could "better help users in a category of queries maybe in which there was no right answer." In other words, Pichai expects that generative AI will supplement Google Search rather than cannibalize it. He added that he's "comfortable" with how Google will address the costs of incorporating LLMs into its search capabilities. 

And while Wood may think that Google could be in trouble because of ChatGPT, she doesn't seem to be too terribly worried. Nearly 2.5% of her Ark Autonomous Technology & Robotics ETF is still invested in Alphabet stock, enough to make it the fund's 11th-largest holding. Google could be OK after all.