OpenAI logo is seen in this illustration taken, March 11, 2024. REUTERS/Dado Ruvic/Illustration

By Juby Babu and Krystal Hu

(Reuters) -OpenAI on Tuesday unveiled ChatGPT Atlas, a long-anticipated artificial intelligence-powered web browser built around its popular chatbot, in a direct challenge to Google Chrome’s dominance.

The launch marks OpenAI’s latest move to capitalize on 800 million weekly active ChatGPT users, as it expands into more aspects of users' online lives by collecting data about consumers' browser behavior. It could accelerate a broader shift toward AI-driven search, as users increasingly turn to conversational tools that synthesize information instead of relying on traditional keyword-based results from Google — intensifying competition between OpenAI and Google.

Shares of Alphabet, which owns the Chrome browser, were down 1.8% in afternoon trading.

Reuters earlier reported on OpenAI’s planned browser launch. It is the latest entrant in a crowded field of AI browsers, which includes Perplexity’s Comet, Brave Browser and Opera’s Neon, as companies race to weave in tools that can summarize pages, fill out forms and draft code to attract users.

Atlas lets users open a ChatGPT sidebar in any window to summarize content, compare products or analyze data from any site. In “agent mode,” now available to paid users, ChatGPT can interact with websites on their behalf — completing tasks from start to finish, such as researching and shopping for a trip.

In a demo on Tuesday, OpenAI developers showcased how ChatGPT could find an online recipe and then automatically purchase all the ingredients. The agent navigated to the Instacart website and added the necessary groceries to the cart — a task that took several minutes to complete.

The browser is now available globally on Apple’s macOS. Versions for Windows, iOS and Android will be released later.

Led by Sam Altman, OpenAI upended the tech industry with the launch of ChatGPT in late 2022. Following its initial success, the company has faced stiff competition from Google and startup Anthropic and has been seeking new areas of growth.

Google, meanwhile, has been developing ways to adapt to shifting search behaviors since ChatGPT’s debut. Depending on the query, each Google search result can now display an AI overview, or AI Mode, alongside traditional links, offering a chatbot-like experience. Last month, Google integrated its Gemini AI model into Chrome for U.S. users, with plans to bring Gemini to the iOS Chrome app as well.

In a win for Google, a federal judge in September ruled that Google won't have to sell the Chrome browser. Judge Amit Mehta said Google can continue paying partners to promote its search engine, noting that heavy investment in generative AI by Big Tech and startups alike now threatens traditional search, making such payments more acceptable.

Despite increasing competition, Google Chrome has held its dominance, with 71.9% market share in the global browser market in September, according to StatCounter. Still, analysts say a new browser from OpenAI could introduce fresh competition for ad dollars.

“Integrating chat into a browser is a precursor for OpenAI starting to sell ads, which it has yet to do so far. Once OpenAI starts selling ads that could take away a significant part of search advertising share from Google, which has around 90% of that spend category,” said Gil Luria, analyst at D.A. Davidson.

(Reporting by Juby Babu in Mexico City and Krystal Hu in San Francisco; Additional reporting by Anhata Rooprai; Editing by Leroy Leo, Alan Barona and Lisa Shumaker)