Chinese state media, AI companies warn of risks in ChatGPT stock frenzy
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[February 09, 2023] SHANGHAI
(Reuters) -Chinese state media on Thursday cautioned against risks in
chasing local ChatGPT-concept stocks, while domestic artificial
intelligence (AI) companies urged investors to be rational after their
soaring share prices caught regulators' attention.
ChatGPT, a chatbot developed by U.S. firm OpenAI and backed by Microsoft
Corp, gives strikingly human-like responses to user queries. Frenzy
around the technology launched at November-end has seen shares of
Beijing Haitian Ruisheng Science Technology Ltd soar 217% this year.
Hanwang Technology Co Ltd has risen as much as 129% as of Wednesday,
CloudWalk Technology Co Ltd 128% and TRS Information Technology Co Ltd
66%.
The stocks retreated on Thursday after the state media warning as well
as a slump in Alphabet Inc shares that wiped out $100 billion in market
value after the Google parent's ChatGPT rival shared inaccurate
information.
In a front-page editorial, the Securities Times highlighted several
technological concepts that previously spurred stock buying in China -
such as fifth-generation telecommunications networks (5G), augmented
reality (AR), virtual reality (VR) and anti-virus garments - the
excitement for which has died down.
Though some hotly chased concepts have been successful, "many more new
ideas haven't been commercialised, or require more time to prove," the
state-backed newspaper said.
"However, some people avidly speculate on fake concepts, luring others
into schemes of pumps and dumps. Investors eventually end up in tears so
they should not follow."
Companies developing ChatGPT-like concepts have also flagged risks at
the request of regulators after their prices shot up amid intense
interest in generative AI - technology that can generate new data and
media such as text and images.
Beijing Haitian Ruisheng Science Technology said its ChatGPT-style
products and services do not yet generate revenue, and that it has no
relationship with OpenAI.
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A keyboard is seen reflected on a
computer screen displaying the website of ChatGPT, an AI chatbot
from OpenAI, in this illustration picture taken Feb. 8, 2023.
REUTERS/Florence Lo/Illustration/File Photo
Though such technology "is on a long-term uptrend, we need to
analyse its speed of growth, and effect, in a cool-headed way," it
said in a filing in response to queries from the Shanghai Stock
Exchange.
The company said it expects a roughly 50% slump in 2022 net profit,
and admonished investors to be cautious as its valuation is
currently much higher than the industry average.
360 Security Technology Co Inc, in response to regulators' queries,
said its self-developed ChatGPT-related technology is still at a
nascent stage and is used only internally as a productivity tool.
It is uncertain about when it can market ChatGPT-style products, and
how effective they will be, so "we advise investors to pay attention
to market trading risks, decide rationally, and invest cautiously."
Among deep-pocketed Chinese firms joining the latest chatbot race,
e-commerce leader Alibaba Group Holding Ltd on Wednesday said it is
developing a ChatGPT-style tool, while rival JD.com Inc said it aims
to integrate ChatGPT-like technology into some products.
Gaming major NetEase Inc plans to deploy similar "large language
model" technology in its education business, a person familiar with
the matter told Reuters.
(Reporting by Samuel Shen, Jason Xue and Brenda Goh; Editing by Anne
Marie Roantree and Christopher Cushing)
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