TLDR
- Alphabet stock dropped 0.6% on Thursday after Perplexity AI announced it would make its AI browser Comet free for all users
- Comet was previously only available through a $200-per-month premium subscription launched in July
- The browser can summarize webpages, extract information, book meetings, send emails, and shop online using AI
- Perplexity CEO Aravind Srinivas said the move aims to combat low-quality internet content and make better browsing accessible to everyone
- The free version will have rate limits, while a $5 monthly tier offers access to premium content from outlets like CNN and The Washington Post
Alphabet stock fell 0.6% on Thursday after AI startup Perplexity announced plans to make its browser Comet available to all users at no cost. The shares traded around $244 per share in afternoon trading.
Perplexity CEO Aravind Srinivas revealed the news at a launch event in San Francisco on Wednesday. The browser had previously been restricted to users paying $200 per month for the company’s premium subscription tier.
“We want to build a better internet, and that needs to be accessible to everybody,” Srinivas told Business Insider. The company launched early access to Comet in July behind the premium paywall.
The browser functions as an AI agent that can perform multiple tasks. Users can book meetings, send emails, research websites, and shop online through the platform. It can also summarize webpages and answer questions about content.
Perplexity is backed by Nvidia and positions Comet as a tool to combat what Srinivas calls “slop.” This refers to low-quality internet content generated by both humans and AI platforms. The browser aims to help users filter through content and focus on high-quality sources.
Free Version Details
The free version will come with rate limits, according to Srinivas. The company is also introducing a $5 monthly subscription tier that provides access to premium content from major outlets.
These outlets include CNN, The Washington Post, and Fortune. The premium subscription previously included access to Perplexity’s spreadsheet feature, web app, and Labs presentation tool.
Comet enters an increasingly crowded AI browser market. Startups like Brave with its Leo browser and The Browser Company with Arc and Dia browsers are pushing traditional browser boundaries. Norwegian tech company Opera has entered the space with its Neon browser.
Competition Heats Up
Perplexity previously made a $34.5 billion bid for Google Chrome. That possibility ended when a court judgment in Alphabet’s antitrust case with U.S. authorities removed the potential requirement for the company to sell the browser.
Alphabet has been working to strengthen Chrome’s AI capabilities. The company recently added its Gemini AI chatbot to the browser.
Microsoft is also competing in this space. The company rolled out an experimental “Copilot Mode” in late July to make its AI assistant faster and smarter.
Wall Street analysts maintain a Strong Buy consensus on Alphabet stock. This rating is based on 30 Buy recommendations and eight Hold ratings issued over the past three months.
The average price target among analysts sits at $248.08. This represents roughly 2% downside from current trading levels.
Chrome holds a commanding position in the browser market. Investors appear to be weighing whether Perplexity’s free offering could pose a competitive threat to that dominance.
The stock decline came as Perplexity launched the free version on Thursday afternoon.
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