Chinese search giant Baidu has unveiled its artificial intelligence chatbot Ernie Bot, presenting its rival to the Microsoft-backed ChatGPT in a pre-recorded video presentation that appeared to disappoint investors.

Baidu chief executive Robin Li said Ernie Bot has not been perfected, but the company went ahead with presenting it due to high demand.

Ernie stands for Enhanced Representation of Knowledge Integration.

Shares plunged after Mr Li showed a pre-recorded demonstration of the Ernie Bot instead of the real-time live demonstration many had expected.

China Baidu
Robin Li introduces the Ernie Bot (Ng Han Guan/AP)

During the demonstration, Ernie Bot was asked questions about a Chinese science-fiction novel, The Three-Body Problem, and was asked to make an image based on prompts.

“Baidu has for over a decade persisted in investing in artificial intelligence … Ernie Bot is the result of many years of hard work,” said Mr Li, adding that the first version was developed in 2019.

Mr Li said 650 companies had signed up to use Ernie Bot, which can be implemented in a variety of applications such as searches, AI cloud, autonomous driving and in smart devices.

The launch came months after OpenAI’s ChatGPT was released, demonstrating its ability in answering questions and even writing essays. Baidu is among several Chinese firms working on similar chatbots.

In February, Baidu first mentioned the internal testing of its Ernie Bot was almost complete.

The company, known in China for its search engine, has shifted its focus in recent years to artificial intelligence, including working on autonomous driving technology and other AI applications.

In its 2022 fiscal year, the company says it spent 23.3 billion yuan (£2.8 billion) on research and development, equivalent to about a fifth of its revenue.