In the Battle of the AI Chatbots, Meta Looks Set to Win

Ever since OpenAI’s ChatGPT launched in November the battle of the artificial intelligence (AI) chatbots has raged… and a winner may have just emerged.

At its Meta Connect event last week, Meta Platforms, Inc. (META) announced its very own generative AI chatbot: Meta AI.

And it’s already poised to rival – and maybe best – ChatGPT and the rest.

So, in today’s Market 360, let’s dig into the details of Meta’s latest AI venture. Then, I’ll share which AI stock I believe to be the best play right now.

How Meta AI Is Different

Meta AI is an advanced conversational assistant that can generate text responses, like its contemporaries. However, it can also generate images based off of a prompt, which ChatGPT and most others can’t yet do.

To use the new chatbot, you can simply message Meta AI one-on-one or in a group chat. It’s currently available on Instagram, WhatsApp, and Messenger (all of which Meta owns), and it will soon be available on Ray-Ban Meta Smart Glasses and Quest 3, Meta’s virtual reality headset.

The image above shows how Meta AI can be used. While this isn’t unique or groundbreaking, the chatbot’s advantage comes from how it offers a response.

Meta AI is partnered with Microsoft Corporation (MSFT) search engine, Bing, so it can provide its users with real-time web results. Anthropic’s Claude is only trained up until December 2022, with some early 2023 knowledge. And until last week, ChatGPT was only trained on data up to September 2021.

So, Meta AI’s access to current information gives it a leg up on some competing chatbots.

The digital assistant is powered on the core principles behind Llama 2, which is Meta’s most recent large language model (LLM). An LLM is an AI model that can generate texts and images. It’s a key part in making an AI chatbot or image generator.

Meta AI, though, runs on more refined conversation data than Llama 2 does. This allows the chatbot to have a friendlier, more human-like tone – instead of sounding robotic, like other AIs.

But Meta didn’t stop there…

To capitalize on, well, the fun of an AI chatbot, Meta created 28 other AI characters to serve as personality-focused digital assistants. While Meta AI on its own is a straightforward, stereotypical chatbot, these characters have more opinions and specific interests. You can see 25 of the 28 below.

Does anyone look familiar? If so, that’s because celebrities and influencers are behind some of the AI characters. To quickly name a few…

Tom Brady portrays Bru, a wisecracking sport debater,
Snoop Dogg is a choose-your-own adventure Dungeon Master,
and Paris Hilton plays Amber, a mystery-solving detective.

So far, all the characters besides Meta AI, Bru, and Perry (Chris Paul’s pro golfer) are limited to knowledge before 2023. So, if you use one of the characters, some responses may still be dated. Meta does plan to bring Bing to all of its characters.

“Our view is that people are going to want to interact with a bunch of different AIs for the different things that you want to do,” Meta CEO Mark Zuckerberg said.

It’s likely a view that will pay off.

Even with all of these features, we’re still in the early innings for Meta AI… and for generative AI. The virtual assistant is currently in beta, which means that Meta is still working out its kinks. User feedback and interactions with the chatbot will improve the model. So, although Meta AI isn’t currently trained on public data, it most likely will be.

So, Meta will have plenty of interactions to train the chatbot with.

As I said before, Meta AI is available on Instagram, WhatsApp, and Messenger. These are incredibly popular social media platforms. According to Statista, WhatsApp and Instagram both had 2 million monthly active users in January of this year, and Messenger had nearly a million.

Because these apps are so widely used, Meta AI could very well be many people’s first experience with an AI chatbot. And because it’s specially made to be user friendly, it could also become the one most people prefer to use.

The Better AI Play

So, while ChatGPT may have kicked off this battle of the AI chatbots… Meta could very well win the chatbot war.

The company’s AI achievements contribute to its high ranking in my Portfolio Grader. Currently, the stock has an A-rating for both it’s Fundamental and Quantitative Grade, making its Total Grade an “A” – or “Strong Buy.”

But even with Meta’s success, I believe that there is an even better AI play to make right now.

I call it the AI Master Key.

You probably know that a Master Key is a single key that can be used to unlock any door in a building.

Imagine a 1,000-room luxury New York high-rise. For privacy and security, each room has its own unique key, which lets residents access their assigned room, but no one else’s. But here’s the thing…

The entire building also has a Master Key — a single key that can gain access to any room. Whoever holds this Master Key has the power to unlock ANY door. And that is essentially what I’ve uncovered in the AI markets — a way to unlock the biggest gains — and potentially none of the losers.

This AI Master Key is a way to potentially unlock the AI industry’s biggest, fastest gains… but with nowhere near the amount of risk of buying small, unproven stocks.

It’s been a strong holding in my Growth Investor Buy List that’s done phenomenally well since my initial recommendation in 2019 – up more than 900% – and it should continue to outperform as AI continues to revolutionize the world.

For the name and ticker of this AI Master Key, click here.

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Sincerely,