I've been using Bing AI instead of Google for a few days to test it out. It gives responses with citations. A few times already it has hallucinated details that aren't on the cited website at all, but that do sound very plausible (for example something about the horns of a bull pointing up when I asked about the etymology of "bullish".)

I think it comes down to the fact that most stuff is actually like 90% bullshit so when you train a model on a corpus of everything you end up with a decent bullshit generator. Which is fine for many purposes but I'm not sure it will take over search.