ChatGPT showed that people could still get value out of something that wasn’t perfect.
E.g. they had this in their labs: https://www.theguardian.com/technology/2022/jun/12/google-en... from July, 2022z
And here's the sad part: they had this back in 2019... see this paper released in Jan 2020: https://blog.research.google/2020/01/towards-conversational-...
One advantage that OpenAI had over Google was having developed RLHF as a way to "align" the model's output to be more acceptable.
Part of Google's dropping the ball at that time period (but catching up now with Gemini) may also have been just not knowing what to do with it. It certainly wasn't apparent pre-ChatGPT that there'd be any huge public demand for something like this, or that people would find so many uses for it in API form, and especially so with LaMBDA's behavioral issues.