The rise of artificial intelligence (AI) has modified a few businesses and disturbed traditional commerce models, including education. With the rise of AI innovation, the way students learn and access educational content has changed significantly. ChatGPT becomes the exemplification of AI advancement, rendering conventional EdTech firms such as Chegg outdated.
Chegg inc. is an educational technology firm that provides homework help and digital and physical course reading rentals. It was propelled in 2005. With a market capitalization of almost $10 billion, the company has been a noteworthy player within the EdTech industry for a long time. Be that as it may, the rise of AI-powered chatbots such as ChatGPT has critically affected its business model. In reality, ChatGPT has, as of now, claimed its first victim, with Chegg’s stock dropping by 50% after the company’s CEO uncovered that ChatGPT was rendering their business obsolete.
ChatGPT is a cutting-edge chatbot that uses the foremost advances in natural language processing (NLP) and machine learning to allow students with personalized learning experiences. It is an AI-powered language model that can reply to inquiries, give clarifications, and compose substance on any given theme. ChatGPT has become a well-known learning apparatus among students because to its broad information database and capacity to memorize unused information.
Also Read: What is ChatGPT? What is its Applications in Education?
The improvement of ChatGPT and other AI-powered chatbots has caused a major move within EdTech commerce. Students are progressively turning to chatbots for study and learning since they give speedier, more precise, and personalised support than conventional EdTech administrations. As a result, demand for conventional EdTech administrations has diminished, coming about in a major loss in income and profit for companies such as Chegg.
Chegg’s financial results over the last year illustrate the seriousness of ChatGPT and comparable AI technologies’ impact on the EdTech business. Net income and net profit margins have fallen by 92% yearly, whereas EBITDA has fallen by 30% yearly. This illustrates the troublesome effect of AI within the education segment, and it is only the beginning.
ChatGPT and other AI-powered chatbots’ effect on the EdTech business is closely resembling the “iPhone moment” in technology. The iPhone changed how we communicate, get data, and interact with technology, upsetting the versatile phone business. Similarly, chatbots fuelled by AI, such as ChatGPT, are changing how students think about and access educational material. They are modifying the face of EdTech commerce, and conventional EdTech companies must alter quickly in order to survive.
So, what does the future of the EdTech business hold? ChatGPT and other AI-powered chatbots are just getting started. As AI innovation progresses, we may expect more troublesome breakthroughs to alter how students learn and access educational resources. In the coming years, we may see AI-powered virtual guides providing students with customized learning experiences, AI-powered essay graders giving more precise and steady evaluations, and AI-powered content generators making high-quality study materials with small human input.
Also Read: Educational AI Tools That Help Teachers and Parents and Support Self-Learning and AI Powered Tools That Can Help You With Language Learning.